This Document Prepared Byand After Recording Return to:Beth S. RubinRiemer & Braunstein LLP71 South Wacker Drive, Suite 3515Chicago, Illinois 60606Address of Property:220 Physicians BoulevardEnnis, Texas
This Document Prepared By and After Recording Return to: |
Beth S. Rubin Riemer & Braunstein LLP 71 South Wacker Drive, Suite 3515 Chicago, Illinois 60606 Address of Property: |
220 Physicians Boulevard Ennis, Texas |
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVERS LICENSE NUMBER.
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT, FIXTURE FILING AND FINANCING STATEMENT
by
G&E HC REIT II ENNIS MOB, LLC
a Delaware limited liability company,
as Grantor,
to Peter S. Graf, as Trustee for the benefit of
BANK OF AMERICA, N.A.,
a national banking association,
as Administrative Agent
This Document Serves as a Fixture Filing under Section 9.502 of the Texas Business and Commercial Code
Grantors Organizational Identification Number is ###-###-####
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT, FIXTURE FILING AND FINANCING STATEMENT
This Deed of Trust, Assignment of Leases and Rents, Security Agreement, Fixture Filing and Financing Statement (this Deed of Trust), is made as of the 28th day of January, 2011 by G&E HC REIT II ENNIS MOB, LLC, a Delaware limited liability company (Grantor), whose address is c/o Grubb & Ellis Equity Advisors, LLC, 1551 North Tustin Avenue, Suite 300, Santa Ana, California 92705, Attention: Danny Prosky, to Peter S. Graf, with an address at Republic Title of Texas, Inc., 2626 Howell Street, 10th Floor, Dallas, Texas 75204 (Trustee) for the benefit of BANK OF AMERICA, N.A., a national banking association with an address at 135 South LaSalle Street, 12th Floor, Chicago, Illinois 60606, Attention: Michelle Herrick, as administrative agent (Administrative Agent) under a Credit Agreement of even date among Borrower (as defined below), Bank of America, N.A., and the other lending institutions which become parties to the Credit Agreement (Bank of America, N.A. and the other lending institutions which become parties to the Credit Agreement are collectively referred to as "Lenders and individually as Lender).
Recitals
Grantor has requested that Administrative Agent and Lenders make the Loan (as hereinafter defined) to Grantor and Grubb & Ellis Healthcare REIT II Holdings LP, a Delaware limited partnership (together with each other party which becomes a borrower under the Credit Agreement, each of whom with Grantor are referred to herein individually and collectively as "Borrower). As a condition precedent to making the Loan, Administrative Agent has required that Grantor execute and deliver this Deed of Trust, Assignment of Leases and Rents, Security Agreement, Fixture Filing and Financing Statement to Trustee for the benefit of Administrative Agent.
Grants and Agreements
Now, therefore, in order to induce Administrative Agent and Lenders to make the Loan to Borrower, Grantor agrees as follows:
Article I
Definitions.
As used in this Deed of Trust, the terms defined in the Preamble hereto shall have the respective meanings specified therein, and the following additional terms shall have the meanings specified:
"Accessories means all fixtures, equipment, systems, machinery, furniture, furnishings, appliances, inventory, goods, building and construction materials, supplies and other articles of personal property, of every kind and character, tangible and intangible (including software embedded therein), now owned or hereafter acquired by Grantor, which are now or hereafter attached to or situated in, on or about the Land or Improvements, or used in or necessary to the complete and proper planning, development, use, occupancy or operation thereof, or acquired (whether delivered to the Land or stored elsewhere) for use or installation in or on the Land or Improvements, and all Additions to the foregoing, all of which are hereby declared to be permanent accessions to the Land.
"Accounts means all accounts of Grantor within the meaning of the Uniform Commercial Code of the State, derived from or arising out of the use, occupancy or enjoyment of the Property or for services rendered therein or thereon.
"Additions means any and all alterations, additions, accessions and improvements to property, substitutions therefor, and renewals and replacements thereof.
"Beneficiary means Administrative Agent, on behalf of itself and certain other Lenders, and its successors and assigns.
"Claim means any liability, suit, action, claim, demand, loss, expense, penalty, fine, judgment or other cost of any kind or nature whatsoever, including fees, costs and expenses of attorneys, consultants, contractors and experts.
"Condemnation means any taking of title to, use of, or any other interest in the Property under the exercise of the power of condemnation or eminent domain, whether temporarily or permanently, by any Governmental Authority or by any other Person acting under or for the benefit of a Governmental Authority.
"Condemnation Awards means any and all judgments, awards of damages (including severance and consequential damages), payments, proceeds, settlements, amounts paid for a taking in lieu of Condemnation, or other compensation heretofore or hereafter made, including interest thereon, and the right to receive the same, as a result of, or in connection with, any Condemnation or threatened Condemnation.
"Contract of Sale means any contract for the sale of all or any part of the Property or any interest therein, whether now in existence or hereafter executed.
"Credit Agreement means the Credit Agreement dated July 19, 2010 among Borrower, Administrative Agent and Lenders which sets forth, among other things, the terms and conditions upon which the proceeds of the Loan will be disbursed, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.
"Deed of Trust means this Deed of Trust, Assignment of Leases and Rents, Security Agreement, Fixture Filing and Financing Statement, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.
"Default means an event or circumstance which, with the giving of Notice or lapse of time, or both, would constitute an Event of Default under the provisions of this Deed of Trust.
"Design and Construction Documents means, collectively, (a) all contracts for services to be rendered, work to be performed or materials to be supplied in the development of the Land or the construction or repair of Improvements, including all agreements with architects, engineers or contractors for such services, work or materials; (b) all plans, drawings and specifications for the development of the Land or the construction or repair of Improvements; (c) all permits, licenses, variances and other rights or approvals issued by or obtained from any Governmental Authority or other Person in connection with the development of the Land or the construction or repair of Improvements; and (d) all amendments of or supplements to any of the foregoing.
"Encumbrance means any Lien, easement, right of way, roadway (public or private), condition, covenant or restriction, Lease or other matter of any nature that would affect title to the Property.
"Environmental Agreement means the Environmental Indemnity Agreement dated July 19, 2010 by and among Borrower, Guarantor and Administrative Agent pertaining to the Property, as the same may from time to time be extended, amended, restated or otherwise modified.
"Event of Default means an event or circumstance specified in Article VI and the continuance of such event or circumstance beyond the applicable grace and/or cure periods therefor, if any, set forth in Article VI.
"Expenses means all fees, charges, costs and expenses of any nature whatsoever incurred at any time and from time to time (whether before or after an Event of Default) by Beneficiary in making, funding, administering or modifying the Loan, in negotiating or entering into any workout of the Loan, or in exercising or enforcing any rights, powers and remedies provided in this Deed of Trust or any of the other Loan Documents, including reasonable attorneys fees, court costs, receivers fees, management fees and costs incurred in the repair, maintenance and operation of, or taking possession of, or selling, the Property.
"Governmental Authority means any governmental or quasi-governmental entity, including any court, department, commission, board, bureau, agency, administration, service, district or other instrumentality of any governmental entity.
"Grantor means G&E HC REIT II Ennis MOB, LLC, a Delaware limited liability company.
"Guarantor means Grubb & Ellis Healthcare REIT II, Inc., a Maryland corporation, and its personal representatives, successors and assigns.
"Guaranty means the Guaranty Agreement dated July 19, 2010 executed by Guarantor to Administrative Agent for the benefit of Lenders, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.
"Improvements means all buildings, structures and other improvements now or hereafter existing, erected or placed on the Land, together with any on-site improvements and off-site improvements in any way used or to be used in connection with the use, enjoyment, occupancy or operation of the Land.
"Insurance Proceeds means the insurance claims under and the proceeds of any and all policies of insurance covering the Property or any part thereof, including all returned and unearned premiums with respect to any insurance relating to such Property, in each case whether now or hereafter existing or arising.
"Land means the real property described in Exhibit A attached hereto and made a part hereof.
"Laws means all federal, state and local laws, statutes, rules, ordinances, regulations, codes, licenses, authorizations, decisions, injunctions, interpretations, orders or decrees of any court or other Governmental Authority having jurisdiction as may be in effect from time to time.
"Leases means all leases, license agreements and other occupancy or use agreements (whether oral or written), now or hereafter existing, which cover or relate to the Property or any part thereof, together with all options therefor, amendments thereto and renewals, modifications and guaranties thereof, including any cash or security deposited under the Leases to secure performance by the tenants of their obligations under the Leases, whether such cash or security is to be held until the expiration of the terms of the Leases or applied to one or more of the installments of rent coming due thereunder. All Leases shall be in compliance with terms and provisions of the Credit Agreement.
"Letter of Credit means any letter of credit for the account of Grantor or its nominee in connection with the development of the Land or the construction of the Improvements, together with any and all extensions, renewals or modifications thereof, substitutions therefor or replacements thereof.
"Lien means any mortgage, deed of trust, pledge, security interest, assignment, judgment, lien or charge of any kind, including any conditional sale or other title retention agreement, any lease in the nature thereof, and the filing of, or agreement to give, any financing statement under the Uniform Commercial Code of any jurisdiction.
"Loan means the loan from any Lender to Borrower, the repayment obligations in connection with which are evidenced by the Note and the Credit Agreement.
"Loan Documents means this Deed of Trust, each Note, the Guaranty, the Environmental Agreement, the Credit Agreement, any Swap Contract, any application or reimbursement agreement executed in connection with any Letter of Credit, and any and all other documents which Grantor, Borrower, Guarantor or any other party or parties have executed and delivered, or may hereafter execute and deliver, to evidence, secure or guarantee the Obligations, or any part thereof, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.
"Note means, singly or collectively, those certain Promissory Notes dated as of the date shown thereon made by Borrower and payable, respectively, to the order of each Lender in the principal face amount of that Lenders Commitment, such Promissory Notes being in the aggregate original principal amount of Twenty Five Million and No/100 Dollars ($25,000,000.00), bearing interest as provided in the Credit Agreement, as the same may from time to time be extended, amended, restated, supplemented or otherwise modified.
"Notice means a notice, request, consent, demand or other communication given in accordance with the provisions of this Deed of Trust.
"Obligations means all present and future debts, liabilities, obligations, covenants and duties of Borrower to Beneficiary and Lenders arising pursuant to, and/or on account of, the provisions of this Deed of Trust, the Note, the Credit Agreement or any of the other Loan Documents, including the obligations: (a) to pay all principal, interest, late charges, prepayment premiums (if any) and other amounts due at any time under the Note; (b) to pay all Expenses, indemnification payments, fees and other amounts due at any time under this Deed of Trust or any of the other Loan Documents, together with interest thereon as herein or therein provided; (c) to pay and perform all obligations of Borrower under any Swap Contract; (d) to perform, observe and comply with all of the other terms, covenants and conditions, expressed or implied, which Grantor and/or Borrower are required to perform, observe or comply with pursuant to this Deed of Trust or any of the other Loan Documents; and (e) to pay and perform all future advances and other obligations that Grantor or any successor in ownership of all or part of the Property may agree to pay and/or perform (whether as principal, surety or guarantor) for the benefit of Beneficiary, when a writing evidences the parties agreement that the advance or obligation be secured by this Deed of Trust.
"Permitted Encumbrances means (a) any matters set forth in any policy of title insurance issued to Beneficiary and insuring Lenders interest in the Property which are acceptable to Beneficiary as of the date hereof, (b) the Liens and interests of this Deed of Trust, and (c) any other Encumbrance that Beneficiary shall expressly approve in its sole and absolute discretion, as evidenced by a marked-up commitment for title insurance initialed on behalf of Beneficiary or by a subsequent endorsement to any title insurance policy issued to Beneficiary and insuring Administrative Agents and Lenders interest in the Property.
"Person means an individual, a corporation, a partnership, a joint venture, a limited liability company, a trust, an unincorporated association, any Governmental Authority or any other entity.
"Personalty means all personal property of any kind or nature whatsoever, whether tangible or intangible and whether now owned or hereafter acquired, in which Grantor (or any Borrower) now has or hereafter acquires an interest and which is used in the construction of, or is placed upon, or is derived from or used in connection with the maintenance, use, occupancy or enjoyment of, the Property, including (a) the Accessories; (b) the Accounts; (c) all franchise, license, management or other agreements with respect to the operation of the Real Property or the business conducted therein (provided all of such agreements shall be subordinate to this Deed of Trust, and Beneficiary shall have no responsibility for the performance of Grantors obligations thereunder) and all general intangibles (including payment intangibles, trademarks, trade names, goodwill, software and symbols) related to the Real Property or the operation thereof; (d) all sewer and water taps, appurtenant water stock or water rights, allocations and agreements for utilities, bonds, letters of credit, permits, certificates, licenses, guaranties, warranties, causes of action, judgments, Claims, profits, security deposits, utility deposits, and all rebates or refunds of fees, Taxes, assessments, charges or deposits paid to any Governmental Authority related to the Real Property or the operation thereof; (e) all of Grantors and Borrowers rights and interests under all Swap Contracts, including all rights to the payment of money from Beneficiary under any Swap Contract and all accounts, deposit accounts and general intangibles, including payment intangibles, described in any Swap Contract; (f) all insurance policies held by Grantor with respect to the Property or Grantors operation thereof; (g) all money, mortgages and documents (whether tangible or electronic) arising from or by virtue of any transactions related to the Property, and all deposits and deposit accounts of Grantor (or any Borrower) with Beneficiary related to the Property, including any such deposit account from which Grantor may from time to time authorize Beneficiary to debit and/or credit payments due with respect to the Loan; and (h) all sums at any time on deposit for the benefit of Grantor (or any Borrower) or held by Beneficiary (whether deposited by or on behalf of Grantor or anyone else) pursuant to any of the provisions of this Deed of Trust or the other Loan Documents together with all Additions to and Proceeds of all of the foregoing.
"Proceeds, when used with respect to any of the Property, means all proceeds of such Property, including all Insurance Proceeds and all other proceeds within the meaning of that term as defined in the Uniform Commercial Code of the State.
"Property means the Real Property and the Personalty and all other rights, interests and benefits of every kind and character which Grantor now has or hereafter acquires in, to or for the benefit of the Real Property and/or the Personalty and all other property and rights used or useful in connection therewith, including all Leases, all Rents, all Condemnation Awards, all Proceeds, and all of Grantors right, title and interest in and to all Design and Construction Contracts, all Contracts of Sale and all Refinancing Commitments.
"Property Assessments means all Taxes, payments in lieu of taxes, water rents, sewer rents, assessments, condominium and owners association assessments and charges, maintenance charges and other governmental or municipal or public or private dues, charges and levies and any Liens (including federal tax liens) which are or may be levied, imposed or assessed upon the Property or any part thereof, or upon any Leases or any Rents, whether levied directly or indirectly or as excise taxes, as income taxes, or otherwise.
"Real Property means the Land and Improvements, together with (a) all estates, title interests, title reversion rights, remainders, increases, issues, profits, rights of way or uses, additions, accretions, servitudes, strips, gaps, gores, liberties, privileges, water rights, water courses, alleys, passages, ways, vaults, licenses, tenements, franchises, hereditaments, appurtenances, easements, rights-of-way, rights of ingress or egress, parking rights, timber, crops, mineral interests and other rights, now or hereafter owned by Grantor and belonging or appertaining to the Land or Improvements; (b) all right, title and interest of Grantor in all development rights appurtenant to the Land or Improvements, including, but not limited to, any oil, gas and other mineral rights; (c) all Claims whatsoever of Grantor with respect to the Land or Improvements, either in law or in equity, in possession or in expectancy; (d) all estate, right, title and interest of Grantor in and to all streets, roads and public places, opened or proposed, now or hereafter adjoining or appertaining to the Land or Improvements; and (e) all options to purchase the Land or Improvements, or any portion thereof or interest therein, and any greater estate in the Land or Improvements, and all Additions to and Proceeds of the foregoing.
"Refinancing Commitment means any commitment from or other agreement with any Person providing for the financing of the Property, some or all of the proceeds of which are intended to be used for the repayment of all or a portion of the Loan.
"Rents means all of the rents, royalties, issues, profits, revenues, earnings, income and other benefits of the Property, or arising from the use or enjoyment of the Property, including all such amounts paid under or arising from any of the Leases and all fees, charges, accounts or other payments for the use or occupancy of rooms or other public facilities within the Real Property.
"State means the state in which the Land is located.
"Swap Contract means any agreement, whether or not in writing, relating to any Swap Transaction, including, unless the context otherwise clearly requires, any form of master agreement (the Master Agreement) published by the International Swaps and Derivatives Association, Inc., or any other master agreement, entered into prior to the date hereof or any time after the date hereof, between Swap Counterparty and Borrower (or any Affiliate [as defined in the Credit Agreement]), together with any related schedule and confirmation, as amended, supplemented, superseded or replaced from time to time.
"Swap Counterparty means Lender or an Affiliate of Lender, in its capacity as counterparty under any Swap Contract.
"Swap Transaction means any transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond option, note or bill option, interest rate option, forward foreign exchange transaction, cap transaction, collar transaction, floor transaction, currency swap transaction, cross-currency rate swap transaction, swap option, currency option, credit swap or default transaction, T-lock, or any other similar transaction (including any option to enter into the foregoing) or any combination of the foregoing, entered into prior to the date hereof or anytime after the date hereof between Swap Counterparty and Grantor (or its Affiliate) so long as a writing, such as a Swap Contract, evidences the parties intent that such obligations shall be secured by this Deed of Trust (and any other Mortgage [as such term is defined in the Credit Agreement]) in connection with the Loan.
"Taxes means all taxes and assessments, whether general or special, ordinary or extraordinary, or foreseen or unforeseen, which at any time may be assessed, levied, confirmed or imposed by any Governmental Authority or any community facilities or other private district on Grantor or on any of its properties or assets or any part thereof or in respect of any of its franchises, businesses, income or profits.
"Transfer means any direct or indirect sale, assignment, conveyance or transfer, including any Contract of Sale and any other contract or agreement to sell, assign, convey or transfer, whether made voluntarily or by operation of Law or otherwise, and whether made with or without consideration.
"Trustee means Peter S. Graf, or his successor in trust who may be acting under and pursuant to this Deed of Trust from time to time.
"UCC or Uniform Commercial Code means The Texas Business and Commerce Code, as amended from time to time.
Article II
Granting Clauses; Condition of Grant.
Section 2.1 Conveyances and Security Interests.
In consideration of the provisions of this Deed of Trust and the sum of TEN DOLLARS ($10.00) cash in hand paid and other good and valuable consideration the receipt and sufficiency of which are acknowledged by Grantor, in order to secure the prompt payment and performance of the Obligations, Grantor hereby (a) GRANTS, BARGAINS, SELLS, CONVEYS, TRANSFERS, ASSIGNS and SETS OVER to Trustee, TO HAVE AND TO HOLD, with GENERAL WARRANTY, all of Grantors right, title and interest now or hereafter acquired, in and to the Real Property, with all rights, appurtenances, and privileges thereunto belonging, with the power of sale for the use and benefit of Beneficiary, Beneficiarys successors and assigns; (b) grants to Beneficiary a security interest in the Personalty; (c) assigns to Beneficiary, and grants to Beneficiary a security interest in, all Condemnation Awards and all Insurance Proceeds; (d) assigns to Beneficiary, and grants to Beneficiary a security interest in, all of Grantors right, title and interest in, but not any of Grantors obligations or liabilities under, all Swap Contracts, Design and Construction Documents, all Contracts of Sale and all Refinancing Commitments, and all Letters of Credit; and (e) assigns to Beneficiary, and grants to Beneficiary a security interest in, all Accounts arising from or related to any transactions related to the Premises (including but not limited to Grantors rights in tenants security deposits, deposits with respect to utility services to the Premises, and any deposits, deposit accounts or reserves hereunder or under any other Loan Documents), and any account or deposit account from which Grantor may from time to time authorize Holder to debit and/or credit payments due with respect to the Loan or any Swap Contract, all rights to the payment of money from Beneficiary under any Swap Contract, and all accounts, deposit accounts and general intangibles including payment intangibles, described in any Swap Contract. All Persons who may have or acquire an interest in all or any part of the Property will be deemed to have notice of, and will be bound by, the terms of the Obligations and each other agreement or Deed of Trust made or entered into in connection with each of the Obligations. Such terms include any provisions in the Note, the Credit Agreement or any Swap Contract which provide that the interest rate on one or more of the Obligations may vary from time to time.
Section 2.2 Absolute Assignment of Leases and Rents.
In consideration of the making of the Loan by Lenders to Borrower, the sum of Ten and No/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Grantor absolutely and unconditionally assigns the Leases and Rents to Beneficiary for the benefit of Lenders. This assignment is, and is intended to be, an unconditional, absolute and present assignment from Grantor to Beneficiary of all of Grantors right, title and interest in and to the Leases and the Rents and not an assignment in the nature of a pledge of the Leases and Rents or the mere grant of a security interest therein. So long as no Event of Default shall exist, however, and so long as Grantor is not in default in the performance of any obligation, covenant or agreement contained in the Leases, Grantor shall have a license (which license shall terminate automatically and without notice upon the occurrence of an Event of Default or a default by Grantor under the Leases) to collect, but not prior to accrual, all Rents. Grantor agrees to collect and hold all Rents in trust for Beneficiary and to use the Rents for the payment of the cost of operating and maintaining the Property and for the payment of the other Obligations before using the Rents for any other purpose.
Section 2.3 Security Agreement and Financing Statement.
This Deed of Trust (a) creates a security interest in the Personalty, and, to the extent the Personalty is not real property, this Deed of Trust constitutes a security agreement from Grantor to Beneficiary under the Uniform Commercial Code of the State, and (b) creates a security interest in favor of Beneficiary for all sums at any time on deposit for the benefit of Grantor or held by Beneficiary (whether deposited by or on behalf of Grantor or anyone else) pursuant to any of the provisions of this Deed of Trust or the other Loan Documents. In addition to all of its other rights under this Deed of Trust and otherwise, Beneficiary shall have all of the rights of a secured party under the Uniform Commercial Code of the State, as in effect from time to time, or under the Uniform Commercial Code in force from time to time in any other state to the extent the same is applicable Law. This Deed of Trust shall also be effective as a financing statement with respect to any other Property as to which a security interest may be perfected by the filing of a financing statement and may be filed as such in any appropriate filing or recording office. The respective mailing addresses of Grantor and Beneficiary are set forth in the Preamble to this Deed of Trust. A carbon, photographic or other reproduction of this Deed of Trust or any other financing statement relating to this Deed of Trust shall be sufficient as a financing statement for any of the purposes referred to in this Section. Grantor hereby irrevocably authorizes Beneficiary at any time and from time to time to file any initial financing statements, amendments thereto and continuation statements as authorized by applicable Law, reasonably required by Beneficiary to establish or maintain the validity, perfection and priority of the security interests granted in this Deed of Trust. The foregoing authorization includes Grantors irrevocable authorization for Beneficiary at any time and from time to time to file any initial financing statements and amendments thereto that indicate the Personalty (i) as all assets of Grantor or words of similar effect, regardless of whether any particular asset comprised in the Personalty falls within the scope of the Uniform Commercial Code of the State or the jurisdiction where the initial financing statement or amendment is filed, or (ii) as being of an equal or lesser scope or with greater detail.
Section 2.4 Fixture Financing Statement.
From the date of its recording, this Deed of Trust shall be effective as a fixture financing statement within the purview of the Uniform Commercial Code with respect to the Real Property and the goods described herein, which goods are or are to become fixtures related to the Real Property (collectively, with the Personalty and other items described in Section 2.3 above, referred to herein as the Collateral). The addresses of Grantor (Debtor) and Beneficiary (Secured Party) are set forth in the Preamble to this Deed of Trust. This Deed of Trust is to be filed for recording with the Recorder of Deeds of the county or the counties where the Property is located. Grantor hereby appoints Beneficiary as its attorney-in-fact to execute and file on its behalf any financing statements, continuation statements or other statements in connection therewith which Beneficiary deems necessary or reasonably advisable to preserve and maintain the priority of the lien hereof, or to extend the effectiveness thereof, under the Uniform Commercial Code or any other laws which may hereafter become applicable. This power, being coupled with an interest, shall be irrevocable so long as any part of the Obligations remains unpaid. Grantor shall pay to Beneficiary, from time to time, upon demand, any and all costs and expenses incurred by Beneficiary in connection with the filing of any such statements including, without limitation, reasonable attorneys fees and all disbursements and such amounts shall be part of the Obligations secured by this Deed of Trust.
Section 2.5 Rights of Beneficiary.
In addition to Beneficiarys rights as a Secured Party under the UCC, Beneficiary may, but shall not be obligated to, at any time without notice and at the expense of Grantor: (a) give notice to any person of Beneficiarys rights hereunder and enforce such rights at law or in equity; (b) insure, protect, defend and preserve the Collateral or any rights or interests of Beneficiary therein if Grantor fails to do so after notice from Beneficiary; and (c) during the existence of an Event of Default endorse, collect and receive any right to payment of money owing to Grantor under or from the Collateral. Notwithstanding the above, in no event shall Beneficiary be deemed to have accepted any property other than cash in satisfaction of any obligation of Grantor to Beneficiary or Lenders unless Beneficiary shall make an express written proposal thereof under UCC §9.621, or other applicable law, and the provisions of UCC §9.620 have been satisfied.
Section 2.6 Release of Deed of Trust and Termination of Assignments and Financing Statements.
If and when Borrower has paid and performed all of the Obligations, and no further advances are to be made under the Credit Agreement, Beneficiary will provide a release of the Property from the lien of this Deed of Trust and termination statements for filed financing statements, if any, to Grantor. Grantor shall be responsible for the recordation of such release and the payment of any recording and filing costs. Upon the recording of such release and the filing of such termination statements, the absolute assignments set forth in shall automatically terminate and become null and void.
Article III
Representations and Warranties.
Grantor makes the following representations and warranties to Beneficiary and Lenders: | ||
Section 3.1 | Title to Real Property. | |
Grantor (a) owns fee simple title to the Real Property, (b) owns all of the beneficial and equitable interest in and to the Real Property, and (c) is lawfully seized and possessed of the Real Property. Grantor has the right and authority to convey the Real Property and does hereby convey the Real Property with general warranty. The Real Property is subject to no Encumbrances other than the Permitted Encumbrances.
Section 3.2 Title to Other Property.
Grantor has good title to the Personalty, and the Personalty is not subject to any Encumbrance other than the Permitted Encumbrances. None of the Leases, Rents, Design and Construction Documents, Contracts of Sale or Refinancing Commitments are subject to any Encumbrance other than the Permitted Encumbrances.
Section 3.3 Property Assessments.
The Real Property is assessed for purposes of Property Assessments as a separate and distinct parcel from any other property, such that the Real Property shall never become subject to the Lien of any Property Assessments levied or assessed against any property other than the Real Property.
Section 3.4 Independence of the Real Property.
Except as set forth in any Permitted Encumbrance, no buildings or other improvements on property not covered by this Deed of Trust rely on the Real Property or any interest therein to fulfill any requirement of any Governmental Authority for the existence of such property, building or improvements; and none of the Real Property relies, or will rely, on any property not covered by this Deed of Trust or any interest therein to fulfill any requirement of any Governmental Authority. The Real Property has been properly subdivided from all other property in accordance with the requirements of any applicable Governmental Authorities.
Section 3.5 Existing Improvements.
The existing Improvements, if any, were, to the best of Grantors knowledge, constructed, and are being used and maintained, in accordance with all applicable Laws, including zoning Laws.
Section 3.6 Leases and Tenants.
The Leases are valid and are in full force and effect, and are in strict compliance with the requirements set forth in the Credit Agreement. Grantor is not in default under any of the terms thereof. Except as expressly permitted in the Credit Agreement, Grantor has not accepted any Rents in advance of the time the same became due under the Leases and has not forgiven, compromised or discounted any of the Rents. Grantor has title to and the right to assign the Leases and Rents to Beneficiary, and no other assignment of the Leases or Rents has been granted. To the best of Grantors knowledge and belief, no tenant or tenants occupying, individually or in the aggregate, more than five percent (5%) of the net rentable area of the Improvements are in default under their Lease(s) or are the subject of any bankruptcy, insolvency or similar proceeding.
Article IV
Affirmative Covenants.
Section 4.1 Obligations.
Grantor agrees to promptly pay and perform, or cause Borrower to pay and perform, all of the Obligations, time being of the essence in each case.
Section 4.2 Property Assessments; Documentary Taxes.
Grantor (a) will promptly pay in full and discharge all Property Assessments, and (b) will furnish to Beneficiary, upon demand, the receipted bills for such Property Assessments prior to the day upon which the same shall become delinquent. Property Assessments shall be considered delinquent as of the first day any interest or penalty commences to accrue thereon. Grantor will promptly pay all stamp, documentary, recordation, transfer and intangible taxes and all other taxes that may from time to time be required to be paid with respect to the Loan, the Note, this Deed of Trust or any of the other Loan Documents.
Section 4.3 Permitted Contests.
Grantor shall not be required to pay any of the Property Assessments, or to comply with any Law, so long as Grantor shall in good faith, and at its cost and expense, contest the amount or validity thereof, or take other appropriate action with respect thereto, in good faith and in an appropriate manner or by appropriate proceedings; provided that (a) such proceedings operate to prevent the collection of, or other realization upon, such Property Assessments or enforcement of the Law so contested, (b) there will be no sale, forfeiture or loss of the Property during the contest, (c) Beneficiary or Lenders are not subjected to any Claim as a result of such contest, and (d) Grantor provides assurances satisfactory to Beneficiary (including the establishment of an appropriate reserve account with Beneficiary) of its ability to pay such Property Assessments or comply with such Law in the event Grantor is unsuccessful in its contest. Each such contest shall be promptly prosecuted to final conclusion or settlement, and Grantor shall indemnify and save Beneficiary harmless against all Claims in connection therewith. Promptly after the settlement or conclusion of such contest or action, Grantor shall comply with such Law and/or pay and discharge the amounts which shall be levied, assessed or imposed or determined to be payable, together with all penalties, fines, interests, costs and expenses in connection therewith.
Section 4.4 Compliance with Laws.
Grantor will comply with and not violate, and cause to be complied with and not violated, all present and future Laws applicable to the Property and its use and operation.
Section 4.5 Maintenance and Repair of the Property.
Grantor, at Grantors sole expense, will (a) keep and maintain Improvements and Accessories in good condition, working order and repair, and (b) make all necessary or appropriate repairs and Additions to Improvements and Accessories, so that each part of the Improvements and all of the Accessories shall at all times be in good condition and fit and proper for the respective purposes for which they were originally intended, erected, or installed.
Section 4.6 Additions to Security.
All right, title and interest of Grantor in and to all Improvements and Additions hereafter constructed or placed on the Property and in and to any Accessories hereafter acquired shall, without any further Deed of Trust, conveyance, assignment or other act by Grantor, become subject to the Lien of this Deed of Trust as fully and completely, and with the same effect, as though now owned by Grantor and specifically described in the granting clauses hereof. Grantor agrees, however, to execute and deliver to Beneficiary such further documents as may be required by the terms of the Credit Agreement and the other Loan Documents.
Section 4.7 Subrogation.
To the extent permitted by Law, Beneficiary shall be subrogated, notwithstanding its release of record, to any Lien now or hereafter existing on the Property to the extent that such Lien is paid or discharged by Beneficiary whether or not from the proceeds of the Loan. This Section shall not be deemed or construed, however, to obligate Beneficiary to pay or discharge any Lien.
Section 4.8 Leases.
(a) Except as expressly permitted in the Credit Agreement, Grantor shall not enter into any Lease with respect to all or any portion of the Property without the prior written consent of Beneficiary.
(b) Beneficiary shall not be obligated to perform or discharge any obligation of Grantor under any Lease. The assignment of Leases provided for in this Deed of Trust in no manner places on Beneficiary any responsibility for (i) the control, care, management or repair of the Property, (ii) the carrying out of any of the terms and conditions of the Leases, (iii) any waste committed on the Property, or (iv) any dangerous or defective condition on the Property (whether known or unknown).
(c) No approval of any Lease by Beneficiary shall be for any purpose other than to protect Beneficiarys security and to preserve Beneficiarys rights under the Loan Documents, and no such approval shall result in a waiver of a Default or Event of Default.
Section 4.9 Insurance.
Grantor will at all times keep the Property insured in the manner and to the extent required in the Credit Agreement. In addition, if the area where the Property is located is now or in the future designated as a special flood hazard area pursuant to the Flood Disaster Protection Act of 1973 (as amended), and if the community where the Property is located is participating in the National Flood Insurance Program, Grantor will obtain and continuously maintain a National Flood Insurance Program Standard Flood Insurance Policy or equivalent covering the Property. Beneficiary may, from time to time, require such additional insurance as Beneficiary may determine is reasonably necessary to protect Beneficiarys Lien hereunder or to assure repayment of all the Obligations.
Section 4.10 Insurance/Condemnation Proceeds.
All Insurance/Condemnation Awards will be paid to Beneficiary for application to the Obligations in the manner and to the extent provided in the Credit Agreement.
Section 4.11 Beneficiarys Right to Cause Performance of Covenants.
If Grantor fails to maintain any insurance and pay the premiums for insurance as required in this Article, to pay all taxes, penalties, assessments, charges, and claims as required in this Article, or to repair and maintain any of the Property as required in this Article, or if Grantor fails to keep or perform any of Grantors other covenants herein, Beneficiary may obtain such insurance, cause such repairs and maintenance to be made, pay such taxes, penalties, assessments, charges, or claims, or cause such other covenants to be performed. Grantor will pay to Beneficiary on demand all amounts paid by Beneficiary for the foregoing and the amount of all expenses incurred by Beneficiary in connection therewith, together with interest thereon from the date when incurred. Such amounts and interest are secured by this Deed of Trust, which creates a Lien in the Property prior to any right, title, interest, lien, or claim in or upon the Property subordinate to the Lien of this Deed of Trust. Any such payments by Beneficiary will not be deemed a waiver of any Default or Event of Default. Beneficiary is not obligated to exercise Beneficiarys rights under this Section and is not liable to Grantor for any failure to do so.
Article V
Negative Covenants.
Section 5.1 Encumbrances.
Grantor will not permit any of the Property to become subject to any Encumbrance other than the Permitted Encumbrances. Within thirty (30) days after the filing of any mechanics lien or other Lien or Encumbrance against the Property, Grantor will promptly discharge the same by payment or filing a bond or otherwise as permitted by Law. So long as Beneficiarys security has been protected by the filing of a bond or otherwise in a manner satisfactory to Beneficiary in its sole and absolute discretion, Grantor shall have the right to contest in good faith any Claim, Lien or Encumbrance, provided that Grantor does so diligently and without prejudice to Beneficiary or delay in completing construction of the Improvements. Grantor shall give Beneficiary Notice of any default under any Lien and Notice of any foreclosure or threat of foreclosure with respect to any of the Property.
Section 5.2 Transfer of the Property.
Grantor will not Transfer, or contract to Transfer, all or any part of the Property or any legal or beneficial interest therein (except for certain Transfers of the Accessories expressly permitted in this Deed of Trust). A Change of Control (as such term is defined in the Credit Agreement) shall be deemed to be a prohibited Transfer of the Property.
Section 5.3 Removal, Demolition or Alteration of Accessories and Improvements.
Except to the extent permitted by the following sentence, no Improvements or Accessories shall be removed, demolished or materially altered without the prior written consent of Beneficiary. Grantor may remove and dispose of, free from the Lien of this Deed of Trust, such Accessories as from time to time become worn out or obsolete, provided that, either (a) at the time of, or prior to, such removal, any such Accessories are replaced with other Accessories which are free from Liens other than Permitted Encumbrances and have a value at least equal to that of the replaced Accessories (and by such removal and replacement Grantor shall be deemed to have subjected such Accessories to the Lien of this Deed of Trust), or (b) so long as a prepayment may be made without the imposition of any premium pursuant to the Note, such Accessories are sold at fair market value for cash and the net cash proceeds received from such disposition are paid over promptly to Beneficiary to be applied to the prepayment of the principal of the Loan.
Section 5.4 Additional Improvements.
Grantor will not construct any Improvements other than those presently on the Land and those described in the Credit Agreement without the prior written consent of Beneficiary. Grantor will complete and pay for, within a reasonable time, any Improvements which Grantor is permitted to construct on the Land. Grantor will construct and erect any permitted Improvements (a) strictly in accordance with all applicable Laws and any private restrictive covenants, (b) entirely on lots or parcels of the Land, (c) so as not to encroach upon any easement or right of way or upon the land of others, and (d) wholly within any building restriction and setback lines applicable to the Land.
Section 5.5 Restrictive Covenants, Zoning, etc.
Without the prior written consent of Beneficiary, Grantor will not initiate, join in, or consent to any change in, any restrictive covenant, easement, zoning ordinance or other public or private restrictions limiting or defining the uses which may be made of the Property. Grantor (a) will promptly perform and observe, and cause to be performed and observed, all of the terms and conditions of all agreements affecting the Property, and (b) will do or cause to be done all things necessary to preserve intact and unimpaired any and all easements, appurtenances and other interests and rights in favor of, or constituting any portion of, the Property.
Article VI
Events of Default.
The occurrence or happening, from time to time, of any one or more of the following shall constitute an Event of Default under this Deed of Trust:
Section 6.1 Payment Obligations.
Grantor or any other Borrower fails to pay (i) any of the Obligations within five (5) days when due (provided, however, there shall be no five (5) day grace period for amounts due at maturity or upon acceleration of the Loan), or (ii) within five (5) days after the same becomes due, any other amount payable hereunder or under any other Loan Document.
Section 6.2 Transfers.
Grantor Transfers, or contracts to Transfer, all or any part of the Property or any legal or beneficial interest therein (except for Transfers of the Accessories expressly permitted under this Deed of Trust). A Change in Control shall be deemed to be a prohibited Transfer of the Property constituting an Event of Default.
Section 6.3 Other Obligations.
Grantor fails to promptly perform or comply with any of the Obligations set forth in this Deed of Trust (other than those expressly described in other Sections of this Article VI), and such failure continues uncured for a period of thirty (30) days after Notice from Beneficiary to Grantor.
Section 6.4 Event of Default Under Other Loan Documents.
An Event of Default (as defined therein) occurs under the Note or the Credit Agreement, or Borrower or Guarantor fails to promptly pay, perform, observe or comply with any obligation or agreement contained in any of the other Loan Documents (within any applicable grace or cure period).
Section 6.5 Change in Zoning or Public Restriction.
Any change in any zoning ordinance or regulation or any other public restriction is enacted, adopted or implemented that limits or defines the uses which may be made of the Property such that the present or intended use of the Property, as specified in the Loan Documents, would be in violation of such zoning ordinance or regulation or public restriction, as changed.
Section 6.6 Default Under Leases.
Grantor fails duly to perform its obligations under any Material Lease (as such term is defined in the Credit Agreement), and such failure is not cured within the grace period, if any, provided in the Material Lease.
Section 6.7 Default Under Other Lien Documents.
A default occurs under any other mortgage, deed of trust or security agreement covering the Property, including any Permitted Encumbrances.
Section 6.8 Execution; Attachment.
Any execution or attachment is levied against any of the Property, and such execution or attachment is not set aside, discharged or stayed within thirty (30) days after the same is levied.
Article VII
Rights and Remedies.
Upon the happening of any Event of Default, Beneficiary shall have the right, in addition to any other rights or remedies available to Beneficiary under any of the Loan Documents or applicable Law, to exercise any one or more of the following rights, powers or remedies:
Section 7.1 Acceleration.
Beneficiary may accelerate all Obligations under the Loan Documents whereupon such Obligations shall become immediately due and payable, without notice of default, notice of acceleration or intention to accelerate, presentment or demand for payment, protest, notice of protest, notice of nonpayment or dishonor, or notices or demands of any kind or character (all of which are hereby waived by Grantor).
Section 7.2 Foreclosure; Judicial Foreclosure.
In the event that any provision in this Deed of Trust shall be inconsistent with any provision of the State law, the provisions of the State law shall take precedence over the provisions of this Deed of Trust, but shall not invalidate or render unenforceable any other provision of this Deed of Trust that can be construed in a manner consistent with applicable law. If any provision of this Deed of Trust shall grant to Beneficiary any rights or remedies upon an Event of Default which are more limited than the rights that would otherwise be vested in Beneficiary under the State law in the absence of said provision, Beneficiary shall be vested with the rights granted by the State law. Without limiting the generality of the foregoing, all expenses incurred by Beneficiary to the extent reimbursable under applicable law, whether incurred before or after any decree or judgment of foreclosure, and whether or not enumerated in this Deed of Trust, shall be added to the Obligations.
Beneficiary may institute one or more actions of foreclosure on this Deed of Trust or to institute other proceedings according to law for foreclosure, and prosecute the same to judgment, execution and sale, for the collection of the Obligations and all costs and expenses of such proceedings, including reasonable attorneys fees and actual attorneys expenses.
To the extent permitted by law, Beneficiary has the option of proceeding as to both the Real Property and the Personalty in accordance with its rights and remedies in respect of the Property, in which event the default provisions of the UCC will not apply. Beneficiary also has the option of exercising, in respect of the Property consisting of Personalty, all of the rights and remedies available to a secured party upon default under the applicable provisions of the UCC in effect in the jurisdiction where the Real Property is located. In the event Beneficiary elects to proceed with respect to the Personalty separately from the Real Property, whenever applicable provisions of the UCC require that notice be reasonable, ten (10) days notice will be deemed reasonable.
Section 7.3 Remedies under the Credit Agreement.
Without limiting the other rights and remedies of Beneficiary set forth in this Deed of Trust, Beneficiary may exercise any and all rights and remedies of Beneficiary specified in the Credit Agreement, or at law or equity.
Section 7.4 Possession of Property Not Required.
Upon any sale of any item of the Property made pursuant to judicial proceedings for foreclosure (Judicial Sale), it will not be necessary for any public officer acting under execution or order of the court (a Selling Official) to have any of the Property present or constructively in his possession.
Section 7.5 Deeds of Trust of Conveyance and Transfer.
Upon the completion of every Judicial Sale, the Selling Official will execute and deliver to each purchaser a bill of sale or deed of conveyance, as appropriate, for the items of the Property that are sold. Grantor hereby grants every such Selling Official the power as the attorney-in-fact of Grantor to execute and deliver in Grantors name all deeds, bills of sale and conveyances necessary to convey and transfer to the purchaser all of Grantors rights, title and interest in the items of Property which are sold. Grantor hereby ratifies and confirms all that such attorneys-in-fact lawfully do pursuant to such power. Nevertheless, Grantor, if so requested by the Selling Official or by any purchaser, will ratify any such sale by executing and delivering to such Selling Official or to such purchaser, as applicable, such deeds, bills of sale or other Deeds of Trust of conveyance and transfer as may be specified in any such request.
Section 7.6 Recitals.
The recitals contained in any Deed of Trust of conveyance or transfer made by a Selling Official to any purchaser at any Judicial Sale will, to the extent permitted by law, conclusively establish the truth and accuracy of the matters stated therein, including the amount of the Obligations, the occurrence of a an Event of Default, and the advertisement and conduct of such Judicial Sale in the manner provided herein or under applicable law, and the qualification of the Selling Official. All prerequisites to such Judicial Sale will be presumed from such recitals to have been satisfied and performed.
Section 7.7 Divestiture of Title; Bar.
To the extent permitted by applicable law, every Judicial Sale, and every sale made as contemplated by this Deed of Trust, will operate to divest all rights, title, and interest of Grantor in and to the items of the Property that are sold, and will be a perpetual bar, both at law and in equity, against Grantor and Grantors heirs, executors, administrators, personal representatives, successors and assigns, and against everyone else, claiming the item sold either from, through or under Grantor or Grantors heirs, executors, administrators, personal representatives, successors or assigns.
Section 7.8 Receipt of Purchase Money Sufficient Discharge.
A receipt from any person authorized to receive the purchase money paid at any Judicial Sale, or other sale contemplated by this Deed of Trust, will be sufficient discharge therefor to the purchaser. After paying such purchase money and receiving such receipt, neither such purchaser nor such purchasers heirs, executors, administrators, personal representatives, successors or assigns will have any responsibility or liability respecting the application of such purchase money or any loss, misapplication or non-application of any of such purchase money, or to inquire as to the authorization, necessity, expediency or regularity of any such sale.
Section 7.9 Purchase by Beneficiary.
In any Judicial Sale, or other public sale made as contemplated by this Deed of Trust, Beneficiary may bid for and purchase any of the Property being sold, and will be entitled, upon presentment of the relevant Loan Documents and documents evidencing the same, to apply the amount of the Obligations held by it against the purchase price for the items of the Property so purchased. The amount so applied will be credited against the Obligations in accordance with the terms of the Credit Agreement.
Section 7.10 Sale of Portion of Property.
The Lien created by this Deed of Trust, as it pertains to any Property that remains unsold, will not be affected by a Judicial Sale of less than all of the Property.
Section 7.11 Judicial Action.
Beneficiary shall have the right from time to time to sue Grantor for any sums (whether interest, damages for failure to pay principal or any installments thereof, taxes, or any other sums required to be paid under the terms of this Deed of Trust, as the same become due), without regard to whether or not any of the other Obligations shall be due, and without prejudice to the right of Beneficiary thereafter to enforce any appropriate remedy against Grantor, including an action of foreclosure or an action for specific performance, for a Default or Event of Default existing at the time such earlier action was commenced.
Section 7.12 Collection of Rents.
Upon the occurrence of an Event of Default, the license granted to Grantor to collect the Rents shall be automatically and immediately revoked, without further notice to or demand upon Grantor. Beneficiary may, but shall not be obligated to, perform any or all obligations of the landlord under any or all of the Leases, and Beneficiary may, but shall not be obligated to, exercise and enforce any or all of Grantors rights under the Leases. Without limitation to the generality of the foregoing, Beneficiary may notify the tenants under the Leases that all Rents are to be paid to Beneficiary, and following such notice all Rents shall be paid directly to Beneficiary and not to Grantor or any other Person other than as directed by Beneficiary, it being understood that a demand by Beneficiary on any tenant under the Leases for the payment of Rent shall be sufficient to warrant payment by such tenant of Rent to Beneficiary without the necessity of further consent by Grantor. Grantor hereby irrevocably authorizes and directs the tenants under the Lease to pay all Rents to Beneficiary instead of to Grantor, upon receipt of written notice from Beneficiary, without the necessity of any inquiry of Grantor and without the necessity of determining the existence or non-existence of an Event of Default. Grantor hereby appoints Beneficiary as Grantors attorney-in-fact with full power of substitution, which appointment shall take effect upon the occurrence of an Event of Default and is coupled with an interest and is irrevocable prior to the full and final payment and performance of the Obligations, in Grantors name or in Beneficiarys name: (a) to endorse all checks and other Deeds of Trust received in payment of Rents and to deposit the same in any account selected by Beneficiary; (b) to give receipts and releases in relation thereto; (c) to institute, prosecute and/or settle actions for the recovery of Rents; (d) to modify the terms of any Leases including terms relating to the Rents payable thereunder; (e) to cancel any Leases; (f) to enter into new Leases; and (g) to do all other acts and things with respect to the Leases and Rents which Beneficiary may deem necessary or desirable to protect the security for the Obligations. Any Rents received shall be applied first to pay all Expenses and next in reduction of the other Obligations. Grantor shall pay, on demand, to Beneficiary, the amount of any deficiency between (i) the Rents received by Beneficiary, and (ii) all Expenses incurred together with interest thereon as provided in the Credit Agreement and the other Loan Documents.
Section 7.13 Receiver.
Upon, or at any time prior or after, the filing of any complaint to foreclose the lien of this Deed of Trust or instituting any other foreclosure of the liens and security interests provided for in this Deed of Trust or any other legal proceedings under this Deed of Trust, Beneficiary may, at Beneficiarys sole option, make application to a court of competent jurisdiction for appointment of a receiver pursuant to applicable law for all or any part of the Property, as a matter of strict right and without notice to Grantor, and Grantor does hereby irrevocably consent to such appointment, waives any and all notices of and defenses to such appointment and agrees not to oppose any application therefor by Beneficiary, but nothing herein is construed to deprive Beneficiary of any other right, remedy or privilege Beneficiary may now have under the law to have a receiver appointed; provided that the appointment of such receiver, trustee or other appointee by virtue of any court order, statute or regulation shall not impair or in any manner prejudice the rights of Beneficiary to receive payment of all of the rents, issues, deposits and profits pursuant to other terms and provisions set forth in this Deed of Trust. Such appointment may be made either before or after sale, without notice; without regard to the solvency or insolvency, at the time of application for such receiver, of the person or persons, if any, liable for the payment of the Obligations; without regard to the value of the Property at such time and whether or not the same is then occupied as a homestead; without bond being required of the applicant; and Beneficiary hereunder or any employee or agent thereof may be appointed as such receiver. Such receiver shall have all powers and duties prescribed by applicable law, including the power to take possession, control and care of the Property and to collect all rents, issues, deposits, profits and avails thereof during the pendency of such foreclosure suit and apply all funds received toward the Obligations, and in the event of a sale and a deficiency where Grantor has not waived its statutory rights of redemption, during the full statutory period of redemption, as well as during any further times when Grantor or its administrators, legal representatives, successors or assigns, except for the intervention of such receiver, would be entitled to collect such rents, issues, deposits, profits and avails, and shall have all other powers that may be necessary or useful in such cases for the protection, possession, control, management and operation of the Property during the whole of any such period. To the extent permitted by law, such receiver may extend or modify any then existing Leases and make new leases of the Property or any part thereof, which extensions, modifications and new leases may provide for terms to expire, or for options to lessees to extend or renew terms to expire, beyond the maturity date of the Loan, it being understood and agreed that any such leases, and the options or other such provisions to be contained therein, shall be binding upon Grantor and all persons whose interests in the Property are subject to the lien hereof, and upon the purchaser or purchasers at any such foreclosure sale, notwithstanding any redemption from sale, discharge of indebtedness, satisfaction of foreclosure decree or issuance of certificate of sale or deed to any purchaser.
Section 7.14 Taking Possession or Control of the Property.
To the extent permitted by Law, and with or without the appointment of a receiver, or an application therefor, Beneficiary may (a) enter upon, and take possession of (and Grantor shall surrender actual possession of), the Property or any part thereof, without notice to Grantor and without bringing any legal action or proceeding, or, if necessary by force, legal proceedings, ejectment or otherwise, and (b) remove and exclude Grantor and its agents and employees therefrom.
Section 7.15 Management of the Property.
Upon obtaining possession of the Property or upon the appointment of a receiver as described in Section 7.13, Beneficiary or the receiver, as the case may be, may, at its sole option, (a) make all necessary or proper repairs and Additions to or upon the Property, (b) operate, maintain, control, make secure and preserve the Property, and (c) complete the construction of any unfinished Improvements on the Property and, in connection therewith, continue any and all outstanding contracts for the erection and completion of such Improvements and make and enter into any further contracts which may be necessary, either in their or its own name or in the name of Grantor (the costs of completing such Improvements shall be Expenses secured by this Deed of Trust and shall accrue interest as provided in the Credit Agreement and the other Loan Documents). Beneficiary or such receiver shall be under no liability for, or by reason of, any such taking of possession, entry, holding, removal, maintaining, operation or management, except for gross negligence or willful misconduct. The exercise of the remedies provided in this Section shall not cure or waive any Event of Default, and the enforcement of such remedies, once commenced, shall continue for so long as Beneficiary shall elect, notwithstanding the fact that the exercise of such remedies may have, for a time, cured the original Event of Default.
Section 7.16 Uniform Commercial Code.
Beneficiary may proceed under the Uniform Commercial Code as to all or any part of the Personalty, and in conjunction therewith may exercise all of the rights, remedies and powers of a secured creditor under the Uniform Commercial Code. Upon the occurrence of any Event of Default, Grantor shall assemble all of the Accessories and make the same available within the Improvements. Any notification required by the Uniform Commercial Code shall be deemed reasonably and properly given if sent in accordance with the Notice provisions of this Deed of Trust at least ten (10) days before any sale or other disposition of the Personalty. Disposition of the Personalty shall be deemed commercially reasonable if made pursuant to a public sale advertised at least twice in a newspaper of general circulation in the community where the Property is located. It shall be deemed commercially reasonable for the Beneficiary to dispose of the Personalty without giving any warranties as to the Personalty and specifically disclaiming all disposition warranties.
Section 7.17 Application of Proceeds.
Unless otherwise provided by applicable Law, all proceeds from the sale of the Property or any part thereof pursuant to the rights and remedies set forth in this Article VII and any other proceeds received by Beneficiary from the exercise of any of its other rights and remedies hereunder or under the other Loan Documents shall be applied first to pay all Expenses and next in reduction of the other Obligations, in such manner and order as Beneficiary may elect.
Section 7.18 Other Remedies.
Beneficiary shall have the right from time to time to protect, exercise and enforce any legal or equitable remedy against Grantor provided under the Loan Documents or by applicable Laws.
Article VIII
[Reserved].
Article IX
Miscellaneous.
Section 9.1 Scope of Deed of Trust.
This Deed of Trust is a deed of trust and mortgage of both real and personal property, a security agreement, an assignment of rents and leases, a financing statement and fixture filing and a collateral assignment, and also covers proceeds and fixtures.
Section 9.2 Notice to Account Debtors.
In addition to the rights granted elsewhere in this Deed of Trust, Beneficiary may at any time notify the account debtors or obligors of any accounts, chattel paper, general intangibles, negotiable instruments or other evidences of indebtedness included in the Collateral to pay Beneficiary directly.
Section 9.3 Rights, Powers and Remedies Cumulative.
Each right, power and remedy of Beneficiary as provided for in this Deed of Trust, or in any of the other Loan Documents or now or hereafter existing by Law, shall be cumulative and concurrent and shall be in addition to every other right, power or remedy provided for in this Deed of Trust, or in any of the other Loan Documents or now or hereafter existing by Law, and the exercise or beginning of the exercise by Beneficiary of any one or more of such rights, powers or remedies shall not preclude the simultaneous or later exercise by Beneficiary of any or all such other rights, powers or remedies.
Section 9.4 No Waiver by Beneficiary.
No course of dealing or conduct by or among Beneficiary or any Lender and Grantor shall be effective to amend, modify or change any provisions of this Deed of Trust or the other Loan Documents. No failure or delay by Beneficiary to insist upon the strict performance of any term, covenant or agreement of this Deed of Trust or of any of the other Loan Documents, or to exercise any right, power or remedy consequent upon a breach thereof, shall constitute a waiver of any such term, covenant or agreement or of any such breach, or preclude Beneficiary from exercising any such right, power or remedy at any later time or times. By accepting payment after the due date of any of the Obligations, Beneficiary shall not be deemed to waive the right either to require prompt payment when due of all other Obligations, or to declare an Event of Default for failure to make prompt payment of any such other Obligations. Neither Borrower nor any other Person now or hereafter obligated for the payment of the whole or any part of the Obligations shall be relieved of such liability by reason of (a) the failure of Beneficiary to comply with any request of Grantor or of any other Person to take action to foreclose this Deed of Trust or otherwise enforce any of the provisions of this Deed of Trust, or (b) any agreement or stipulation between any subsequent owner or owners of the Property and Beneficiary, or (c) Beneficiarys extending the time of payment or modifying the terms of this Deed of Trust or any of the other Loan Documents without first having obtained the consent of Grantor, Borrower or such other Person. Regardless of consideration, and without the necessity for any notice to or consent by the holder of any subordinate Lien on the Property, Beneficiary may release any Person at any time liable for any of the Obligations or any part of the security for the Obligations and may extend the time of payment or otherwise modify the terms of this Deed of Trust or any of the other Loan Documents without in any way impairing or affecting the Lien of this Deed of Trust or the priority of this Deed of Trust over any subordinate Lien. The holder of any subordinate Lien shall have no right to terminate any Lease regardless of whether or not such Lease is subordinate to this Deed of Trust. Beneficiary may resort to the security or collateral described in this Deed of Trust or any of the other Loan Documents in such order and manner as Beneficiary may elect in its sole discretion.
Section 9.5 Waivers and Agreements Regarding Remedies.
To the full extent Grantor may do so, Grantor hereby:
(a) to the full extent permitted by law, hereby voluntarily and knowingly waives its rights to reinstatement and redemption, and to the full extent permitted by law, waives the benefits of all present and future valuation, appraisement, homestead, exemption, stay, extension or redemption, right to notice of election to accelerate the Obligations, and moratorium laws under any state or federal law;
(b) waives all rights to a marshaling of the assets of Grantor or Borrower, including the Property, or to a sale in the inverse order of alienation in the event of a foreclosure of the Property, and agrees not to assert any right under any Law pertaining to the marshaling of assets, the sale in inverse order of alienation, the exemption of homestead, the administration of estates of decedents, or other matters whatsoever to defeat, reduce or affect the right of Beneficiary under the terms of this Deed of Trust to a sale of the Property without any prior or different resort for collection, or the right of Beneficiary to the payment of the Obligations out of the proceeds of sale of the Property in preference to every other claimant whatsoever;
(c) waives any right to bring or utilize any defense, counterclaim or setoff, other than one which denies the existence or sufficiency of the facts upon which any foreclosure action is grounded. If any defense, counterclaim or setoff, other than one permitted by the preceding clause, is timely raised in a foreclosure action, such defense, counterclaim or setoff shall be dismissed. If such defense, counterclaim or setoff is based on a Claim which could be tried in an action for money damages, such Claim may be brought in a separate action which shall not thereafter be consolidated with the foreclosure action. The bringing of such separate action for money damages shall not be deemed to afford any grounds for staying the foreclosure action; and
(d) waives and relinquishes any and all rights and remedies which Grantor or any Borrower may have or be able to assert by reason of the provisions of any Laws pertaining to the rights and remedies of sureties.
Section 9.6 Successors and Assigns.
All of the grants, covenants, terms, provisions and conditions of this Deed of Trust shall run with the Land and shall apply to and bind the representatives, successors and assigns of Grantor (including any permitted subsequent owner of the Property), and inure to the benefit of Beneficiary, on behalf of Lenders, and their respective successors and assigns.
Section 9.7 No Warranty by Beneficiary.
By inspecting the Property or by accepting or approving anything required to be observed, performed or fulfilled by Grantor or to be given to Beneficiary pursuant to this Deed of Trust or any of the other Loan Documents, Beneficiary shall not be deemed to have warranted or represented the condition, sufficiency, legality, effectiveness or legal effect of the same, and such acceptance or approval shall not constitute any warranty or representation with respect thereto by Beneficiary.
Section 9.8 Amendments.
This Deed of Trust may not be modified or amended except by an agreement in writing, signed by the party against whom enforcement of the change is sought.
Section 9.9 Severability.
In the event any one or more of the provisions of this Deed of Trust or any of the other Loan Documents shall for any reason be held to be invalid, illegal or unenforceable, in whole or in part or in any other respect, or in the event any one or more of the provisions of the Loan Documents operates or would prospectively operate to invalidate this Deed of Trust or any of the other Loan Documents, then and in either of those events, at the option of Beneficiary, such provision or provisions only shall be deemed null and void and shall not affect the validity of the remaining Obligations, and the remaining provisions of the Loan Documents shall remain operative and in full force and effect and shall in no way be affected, prejudiced or disturbed thereby.
Section 9.10 Notices.
All Notices required or which any party desires to give hereunder or under any other Loan Document shall be in writing and, unless otherwise specifically provided in such other Loan Document, shall be deemed sufficiently given or furnished if delivered by personal delivery, by nationally recognized overnight courier service or by certified United States mail, postage prepaid, addressed to the party to whom directed at the applicable address specified in the Preamble to this Deed of Trust (unless changed by similar notice in writing given by the particular party whose address is to be changed) or by facsimile. Any Notice shall be deemed to have been given either at the time of personal delivery or, in the case of courier or mail, as of the date of first attempted delivery at the address and in the manner provided herein, or, in the case of facsimile, upon receipt; provided that service of a notice required by Texas Property Code Section 51.002, as amended, shall be considered complete when the requirements of that statute are met. Notwithstanding the foregoing, no notice of change of address shall be effective except upon actual receipt. This Section shall not be construed in any way to affect or impair any waiver of notice or demand provided in this Deed of Trust or in any other Loan Document or to require giving of notice or demand to or upon any Person in any situation or for any reason.
Section 9.11 Joint and Several Liability.
If Grantor consists of two (2) or more Persons, the term Grantor shall also refer to all Persons signing this Deed of Trust as Grantor, and to each of them, and all of them are jointly and severally bound, obligated and liable hereunder. Beneficiary may release, compromise, modify or settle with any of Grantor, in whole or in part, without impairing, lessening or affecting the obligations and liabilities of the others of Grantor hereunder or under the Note. Any of the acts mentioned aforesaid may be done without the approval or consent of, or notice to, any of Grantor or any Borrower.
Section 9.12 Rules of Construction.
The words hereof, herein, hereunder, hereto and other words of similar import refer to this Deed of Trust in its entirety. The terms agree and agreements mean and include covenant and covenants. The words include and including shall be interpreted as if followed by the words without limitation. The headings of this Deed of Trust are for convenience of reference only and shall not be considered a part hereof and are not in any way intended to define, limit or enlarge the terms hereof. All references (a) made in the neuter, masculine or feminine gender shall be deemed to have been made in all such genders, (b) made in the singular or plural number shall be deemed to have been made, respectively, in the plural or singular number as well, (c) to the Loan Documents are to the same as extended, amended, restated, supplemented or otherwise modified from time to time unless expressly indicated otherwise, (d) to the Land, Improvements, Personalty, Real Property or Property shall mean all or any portion of each of the foregoing, respectively, and (e) to Articles or Sections are to the respective Articles or Sections contained in this Deed of Trust unless expressly indicated otherwise. Any term used or defined in the Uniform Commercial Code of the State, as in effect from time to time, which is not defined in this Deed of Trust shall have the meaning ascribed to that term in the Uniform Commercial Code of the State. If a term is defined in Article 9 of the Uniform Commercial Code of the State differently than in another Article of the Uniform Commercial Code of the State, the term shall have the meaning specified in Article 9.
Section 9.13 Governing Law; Litigation. |
THIS DEED OF TRUST SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS (WITHOUT GIVING EFFECT TO ILLINOIS CHOICE OF LAW PRINCIPLES), EXCEPT WITH RESPECT TO (I) WHETHER A TRANSACTION TRANSFERS OR CREATES AN INTEREST IN REAL PROPERTY FOR SECURITY PURPOSES OR OTHERWISE, (II) THE NATURE OF AN INTEREST IN REAL PROPERTY THAT IS TRANSFERRED OR CREATED BY A TRANSACTION, (III) THE METHOD FOR FORECLOSURE OF A LIEN ON REAL PROPERTY, (IV) THE NATURE OF AN INTEREST IN REAL PROPERTY THAT RESULTS FROM FORECLOSURE, (V) THE MANNER AND EFFECT OF RECORDING OR FAILING TO RECORD EVIDENCE OF A TRANSACTION THAT TRANSFERS OR CREATES AN INTEREST IN REAL PROPERTY, AND (VI) THE ENFORCEMENT HEREOF AGAINST THE PROPERTY IN THE STATE OF TEXAS, IN WHICH CASE OR CASES SUCH MATTER(S) SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS (WITHOUT GIVING EFFECT TO TEXAS CHOICE OF LAW PRINCIPLES). TO THE EXTENT THAT THIS DEED OF TRUST MAY OPERATE AS A SECURITY AGREEMENT UNDER THE UNIFORM COMMERCIAL CODE OF THE STATE OF TEXAS, BENEFICIARY SHALL HAVE ALL RIGHTS AND REMEDIES CONFERRED THEREIN FOR THE BENEFIT OF A SECURED PARTY, AS SUCH TERM IS DEFINED THEREIN, THE ENFORCEMENT OF WHICH SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS (WITHOUT GIVING EFFECT TO TEXAS CHOICE OF LAW PRINCIPLES).
TO THE MAXIMUM EXTENT PERMITTED BY LAW, GRANTOR HEREBY AGREES THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS DEED OF TRUST SHALL BE TRIED AND DETERMINED ONLY IN THE STATE AND FEDERAL COURT LOCATED IN THE COUNTY OF COOK, STATE OF ILLINOIS OR, AT THE SOLE OPTION OF BENEFICIARY, IN ANY OTHER COURT IN WHICH BENEFICIARY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY, EXCEPT THAT ANY ACTION TO FORECLOSE THIS DEED OF TRUST, TO OBTAIN POSSESSION OF THE PROPERTY, TO HAVE A RECEIVER APPOINTED FOR THE PROPERTY OR TO ENFORCE ANY OTHER REMEDY HEREIN AFFECTING THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, INJUNCTIVE RELIEF, SHALL BE BROUGHT ONLY IN THE COUNTY OF ELLIS, STATE OF TEXAS. TO THE MAXIMUM EXTENT PERMITTED BY LAW, GRANTOR HEREBY EXPRESSLY WAIVES ANY RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION. TO THE MAXIMUM EXTENT PERMITTED BY LAW, GRANTOR HEREBY WAIVES PERSONAL SERVICE OF PROCESS UPON GRANTOR, AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED TO GRANTOR AT THE ADDRESS STATED IN THIS DEED OF TRUST AND SERVICE SO MADE WILL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT.
Section 9.14 Use of Proceeds.
Grantor represents and warrants to Beneficiary (a) that the proceeds of the Note secured by this Deed of Trust will be used for the purposes specified in the Loan Documents, and that the Obligations constitute a business loan, and (b) that the Loan evidenced by the Note is an exempted transaction under the Truth In Lending Act, 15 U.S.C. §1601 et seq.
Section 9.15 Cross-Default/Cross-Collateralization.
This Deed of Trust shall be cross-defaulted and cross-collateralized with all Mortgages (as such term is defined in the Credit Agreement) delivered during the term of the Loan, whether existing as of the date of this Deed of Trust or subsequently made. A default not cured within any applicable grace or cure period under any of the other Mortgage shall constitute an Event of Default under this Deed of Trust. An Event of Default under this Deed of Trust shall constitute an Event of Default under all of the other Mortgages. To the extent not prohibited by applicable law, if Beneficiary, at its option, avails itself of this cross-collateralization/cross-default provision, Beneficiary shall have the option to pursue its remedies in any combinations and against any or all of Beneficiarys security for the Loan, whether successively, concurrently or otherwise. Grantor acknowledges that Beneficiary is unwilling to make the Loan unless Grantor agrees that this Deed of Trust and the other Mortgages are cross-collateralized and cross-defaulted and therefore, since it is in the best interest of Grantor that Beneficiary make the Loan, Grantor has agreed to cross-collateralize and cross-default this Deed of Trust and the other Mortgages as set forth hereinabove.
Section 9.16 Other Amounts Secured; Maximum Indebtedness.
Grantor acknowledges and agrees that this Deed of Trust secures the entire principal amount of the Note and interest accrued thereon, regardless of whether any or all of the Loan proceeds are disbursed on or after the date hereof, and regardless of whether the outstanding principal is repaid in whole or part or are future advances made at a later date, any and all litigation and other expenses and any other amounts as provided herein or in any of the other Loan Documents, including, without limitation, the payment of any and all loan commissions, service charges, liquidated damages, expenses and advances due to or paid or incurred by Beneficiary in connection with the Loan, all in accordance with the Loan commitment issued in connection with this transaction and the Loan Documents. Under no circumstances, however, shall the total indebtedness secured hereby exceed Fifty Million and No/100 Dollars ($50,000,000.00). It is agreed that any future advances made by Beneficiary for the benefit of Grantor from time to time under this Deed of Trust or the other Loan Documents and whether or not such advances are obligatory or are made at the option of Beneficiary, made at any time from and after the date of this Deed of Trust, and all interest accruing thereon, shall be equally secured by this Deed of Trust and shall have the same priority as all amounts, if any, advanced as of the date hereof and shall be subject to all of the terms and provisions of this Deed of Trust. This Deed of Trust shall be valid and have priority to the extent of the full amount of the indebtedness secured hereby over all subsequent liens and encumbrances, including statutory liens, excepting solely taxes and assessments levied on the Property given priority by law.
Section 9.17 Adjustable Deed of Trust Loan Provision.
The Note which this Deed of Trust secures is an adjustable note on which the interest rate may be adjusted from time to time in accordance with the terms and provisions set forth in the Credit Agreement.
Section 9.18 | [Intentionally omitted.] | |
Section 9.19 | Deed in Trust. | |
If title to the Property or any part thereof is now or hereafter becomes vested in a trustee, any prohibition or restriction contained herein against the creation of any lien on the Property shall be construed as a similar prohibition or restriction against the creation of any lien on or security interest in the beneficial interest of such trust.
Section 9.20 Collateral Protection.
Unless Grantor provides Beneficiary with evidence of the insurance required by this Deed of Trust or any other Loan Document, Beneficiary may purchase insurance at Grantors expense to protect Beneficiarys interest in the Property or any other collateral for the Obligations. This insurance may, but need not, protect Grantors interests. The coverage Beneficiary purchases may not pay any claim that Grantor makes or any claim that is made against Grantor in connection with the Property or any other collateral for the Obligations. Grantor may later cancel any insurance purchased by Beneficiary, but only after providing Beneficiary with evidence that Grantor has obtained insurance as required under this Deed of Trust or any other Loan Document. If Beneficiary purchases insurance for the Property or any other collateral for the Obligations, Grantor shall be responsible for the costs of that insurance, including interest in any other charges that Beneficiary may lawfully impose in connection with the placement of the insurance, until the effective date of the cancellation or expiration of the insurance. The costs of the insurance may be added to the Obligations. The costs of the insurance may be more than the cost of insurance that Grantor may be able to obtain on its own.
Section 9.21 State Specific Provisions/Rights and Remedies.
In addition to those rights and remedies described in Article VII, the following provisions are added. In the event of any conflict between Section 9.21 through and including Section 9.30 and any other provisions of this Deed of Trust, the provisions of Section 9.21 through and including Section 9.30 shall control:
(a) Right to Accelerate. Beneficiary may, without notice, demand, presentment, notice of nonpayment or nonperformance, protest, notice of protest, notice of intent to accelerate, notice of acceleration, or any other notice or any other action, all of which are hereby waived (except as required under the other Loan Documents) by Grantor and all other parties obligated in any manner whatsoever on the Obligations, declare the entire unpaid balance of the Obligations immediately due and payable, and upon such declaration, the entire unpaid balance of the Obligations shall be immediately due and payable. The failure to exercise any remedy available to Beneficiary shall not be deemed to be a waiver of any rights or remedies of Beneficiary under the Loan Documents, at law or in equity.
(b) Right to Perform Grantors Covenants. If Grantor has failed to keep or perform any covenant whatsoever contained in this Deed of Trust or the other Loan Documents, Beneficiary, may, but shall not be obligated to any person to do so, perform or attempt to perform said covenant, and any payment made or expense incurred in the performance or attempted performance of any such covenant shall be and become a part of the Obligations, and Grantor promises, upon demand, to pay to Beneficiary at the place where the Note is payable, all sums so advanced or paid by Beneficiary, with interest from the date when paid or incurred by Beneficiary at the rate of interest then applicable on the outstanding principal balance of the Note. No such payment by Beneficiary shall constitute a waiver of any Event of Default. In addition to the liens and security interests hereof, Beneficiary shall be subrogated to all rights, titles, liens and security interests securing the payment of any debt, claim, tax or assessment for the payment of which Beneficiary may make an advance, or which Beneficiary may pay.
(c) Right of Entry. Beneficiary is authorized, prior or subsequent to the institution of any foreclosure proceedings, enter upon the Property, or any part thereof, and take exclusive possession of the Property and the Collateral and of all books, records and accounts relating thereto and to exercise without interference from Grantor any and all rights which Grantor has with respect to the management, possession, operation, protection or preservation of the Property and the Collateral, including without limitation the right to rent the same for the account of Grantor and to deduct from such Rents all costs, expenses and liabilities of every character incurred by Beneficiary in collecting such Rents and in managing, operating, maintaining, protecting, or preserving the Property and the Collateral and to apply the remainder of such Rents on the Obligations in such manner as Beneficiary may elect. All such costs, expenses and liabilities incurred by Beneficiary in collecting such Rents and in managing, operating, maintaining, protecting or preserving the Property and the Collateral, if not paid out of Rents as hereinabove provided, shall constitute a demand obligation owing by Grantor and shall bear interest from the date of expenditure until paid at the rate of interest then applicable on the outstanding principal balance of the Note, all of which shall constitute a portion of the Obligations. If necessary to obtain the possession provided for above, Beneficiary may invoke any and all legal remedies to dispossess Grantor, including specifically one or more actions for forcible entry and detainer, trespass to try title and restitution. In connection with any action taken by Beneficiary pursuant to this subsection (c), Beneficiary shall not be liable for any loss sustained by Grantor resulting from any failure to let the Property, or any part thereof, or from any other act or omission of Beneficiary in managing the Property unless such loss is caused by the gross negligence or willful misconduct (but not the negligence) of Beneficiary, nor shall Beneficiary be obligated to perform or discharge any obligation, duty or liability under any Lease or the Ground Lease or under or by reason hereof or the exercise of rights or remedies hereunder. GRANTOR SHALL AND DOES HEREBY AGREE TO INDEMNIFY BENEFICIARY FOR, AND TO HOLD HARMLESS BENEFICIARY FROM, ANY AND ALL LIABILITY, LOSS OR DAMAGE, WHICH MAY OR MIGHT BE INCURRED BY BENEFICIARY UNDER ANY SUCH LEASE OR THE GROUND LEASE OR UNDER OR BY REASON HEREOF OR THE EXERCISE OF RIGHTS OR REMEDIES HEREUNDER, AND, WITH THE EXCEPTION OF BENEFICIARYS GROSS NEGLIGENCE OR WILLFUL MISCONDUCT (BUT NOT THE NEGLIGENCE), FROM ANY AND ALL CLAIMS AND DEMANDS WHATSOEVER WHICH MAY BE ASSERTED AGAINST BENEFICIARY BY REASON OF ANY ALLEGED OBLIGATIONS OR UNDERTAKINGS ON ITS PART TO PERFORM OR DISCHARGE ANY OF THE TERMS, COVENANTS OR AGREEMENTS CONTAINED IN ANY SUCH LEASE OR THE GROUND LEASE. Should Beneficiary incur any such liability, the reasonable amount thereof, including without limitation costs, expenses and reasonable attorneys fees, together with interest thereon from the date of expenditure until paid at the rate of interest then applicable on the outstanding principal balance of the Note, shall be secured hereby, and Grantor shall reimburse Beneficiary therefor immediately upon demand. Nothing in this subsection shall impose any duty, obligation or responsibility upon Beneficiary for the control, care, management, leasing or repair of the Property and the Collateral, nor for the carrying out of any of the terms and conditions of any such Lease or the Ground Lease; nor shall it operate to make Beneficiary responsible or liable for any waste committed on the Property and the Collateral by the tenants or by any other parties, or for any Hazardous Materials on or under the Property or the Collateral, or for any dangerous or defective condition of the Property or the Collateral or for any negligence in the management, leasing, upkeep, repair or control of the Property or the Collateral resulting in loss or injury or death to any tenant, licensee, employee or stranger, other than Beneficiarys gross negligence or willful misconduct (but not its negligence). Grantor hereby assents to, ratifies and confirms any and all actions of Beneficiary with respect to the Property and the Collateral taken under this subsection (c). For purposes of this subsection, Beneficiary shall include Beneficiary and Lenders, and their respective officers, directors, shareholders, partners, employees and agents, and any persons or entities owned or controlled by, owning or controlling, or under control of or an affiliate of Beneficiary or any Lender.
The remedies in this subsection are in addition to other remedies available to Beneficiary, and the exercise of the remedies in this subsection shall not be deemed to be an election of nonjudicial or judicial remedies otherwise available to Beneficiary. The remedies in this Section 9.21 are available under and governed by the real property laws of Texas and are not governed by the personal property laws of Texas, including but not limited to, the power to dispose of personal property in a commercially reasonable manner under Section 9.610 of the UCC. No action by Beneficiary taken pursuant to this subsection, shall be deemed to be an election to dispose of personal property under Section 9.621 of the UCC. Any receipt of consideration received by Beneficiary pursuant to this Section 9.21 shall be immediately credited against the Obligations (in the inverse order of maturity) and the value of said consideration shall be treated like any other payment against the Obligations.
(d) Foreclosure-Power of Sale. Beneficiary may request Trustee to proceed with foreclosure under the power of sale which is hereby conferred, such foreclosure to be accomplished in accordance with the following provisions:
(i) Public Sale. Trustee is hereby authorized and empowered, and it shall be Trustees special duty, upon such request of Beneficiary, to sell the Property and the Collateral, or any part thereof, at public auction to the highest bidder for cash, with or without having taken possession of same. Any such sale (including notice thereof) shall comply with the applicable requirements, at the time of the sale, of Section 51.002 of the Texas Property Code or, if and to the extent such statute is not then in force, with the applicable requirements, at the time of the sale, of the successor statute or statutes, if any, governing sales of Texas real property under powers of sale conferred by deeds of trust. If there is no statute in force at the time of the sale governing sales of Texas real property under powers of sale conferred by deeds of trust, such sale shall comply with applicable law, at the time of the sale, governing sales of Texas real property under powers of sale conferred by deeds of trust.
(ii) Right to Require Proof of Financial Ability and/or Cash Bid. At any time during the bidding, Trustee may require a bidding party (A) to disclose its full name, state and city of residence, occupation and specific business office location, and the name and address of the principal the bidding party is representing (if applicable), and (B) to demonstrate reasonable evidence of the bidding partys financial ability (or, if applicable, the financial ability of the principal of such bidding party), as a condition to the bidding party submitting bids at the foreclosure sale. If any such bidding party (the Questioned Bidder) declines to comply with Trustees requirement in this regard, or if such Questioned Bidder does respond but Trustee, in Trustees sole and absolute discretion, deems the information or the evidence of the financial ability of the Questioned Bidder (or, if applicable, the principal of such bidding party) to be inadequate, then Trustee may continue the bidding with reservation; and in such event (1) Trustee shall be authorized to caution the Questioned Bidder concerning the legal obligations to be incurred in submitting bids, and (2) if the Questioned Bidder is not the highest bidder at the sale, or if having been the highest bidder the Questioned Bidder fails to deliver the cash purchase price payment promptly to Trustee, all bids by the Questioned Bidder shall be null and void. Trustee may, in Trustees sole and absolute discretion, determine that a credit bid may be in the best interest of Grantor, Beneficiary and Lenders, and elect to sell the Property and/or the Collateral for credit or for a combination of cash and credit; provided, however, that Trustee shall have no obligation to accept any bid except an all cash bid. In the event Trustee requires a cash bid and cash is not delivered within a reasonable time after conclusion of the bidding process, as specified by Trustee, but in no event later than 3:45 p.m. local time on the day of sale, then said contingent sale shall be null and void, the bidding process may be recommenced, and any subsequent bids or sale shall be made as if no prior bids were made or accepted.
(iii) Sale Subject to Unmatured Indebtedness. In addition to the rights and powers of sale granted under the preceding provisions of this subsection, if an Event of Default is made in the payment of any portion of the Obligations, Beneficiary, may, at Beneficiarys option, at once or at any time thereafter while any matured portion remains unpaid, without declaring the entire Obligations to be due and payable, orally or in writing direct Trustee to enforce this trust and to sell the Property and the Collateral subject to such unmatured Obligations and to the rights, powers, liens, security interests and assignments securing or providing recourse for payment of such unmatured Obligations, in the same manner, all as provided in the preceding provisions of this subsection. Sales made without maturing the Obligations may be made hereunder whenever there is an Event of Default in the payment of any portion of the Obligations, without exhausting the power of sale granted hereby, and without affecting in any way the power of sale granted under this subsection, the unmatured balance of the Obligations or the rights, powers, liens, security interests, and assignments securing or providing recourse for payment of the Obligations.
(iv) Partial Foreclosure. Sale of a part of the Property or Collateral shall not exhaust the power of sale, but sales may be made from time to time until the Obligations are paid, performed and discharged in full. It is intended by each of the foregoing provisions of this subsection that Trustee may, after any request or direction by Beneficiary, sell not only the Property, but also the Collateral and other interests constituting security for the Loan under the Loan Documents, or any part thereof, along with the Property and the Collateral or any part thereof, as a unit and as a part of a single sale, or may sell at any time or from time to time any part or parts of the Property and the Collateral separately from the remainder of the Property and the Collateral. It shall not be necessary to have present or to exhibit at any sale any of the Property and the Collateral.
(v) Trustees Deeds. After any sale under this subsection, Trustee shall make good and sufficient deeds, assignments and other conveyances to the purchaser or purchasers thereunder in the name of Grantor, conveying the Property and the Collateral or any part thereof so sold to the purchaser or purchasers with general warranty of title by Grantor. It is agreed that in any deeds, assignments or other conveyances given by Trustee, any and all statements of fact or other recitals therein made as to the identity of Beneficiary or Lenders, the occurrence or existence of any Default or Event of Default, the notice of intention to accelerate, or acceleration of, the maturity of the Obligations, the request to sell, notice of sale, time, place, terms and manner of sale, and receipt, distribution and application of the money realized therefrom, the due and proper appointment of a substitute trustee, and without being limited by the foregoing, any other act or thing having been duly done by or on behalf of Beneficiary or by or on behalf of Trustee, shall be taken by all courts of law and equity as prima facie evidence that such statements or recitals state true, correct, and complete facts and are without further question to be so accepted, and Grantor does hereby ratify and confirm any and all acts that Trustee may lawfully do in the premises by virtue hereof.
(e) Beneficiarys Judicial Remedies. Beneficiary, or Trustee upon written request of Beneficiary, may proceed by suit or suits, at law or in equity, to enforce the payment, performance and discharge of the Obligations in accordance with the terms hereof, of the Note and the other Loan Documents, to foreclose the liens and security interests of this Deed of Trust as against all or any part of the Property and the Collateral, and to have all or any part of the Property and the Collateral sold under the judgment or decree of a court of competent jurisdiction. This remedy shall be cumulative of any other nonjudicial remedies available to Beneficiary with respect to the Loan Documents. Proceeding with a request or receiving a judgment for legal relief shall not be or be deemed to be an election of remedies or bar any available nonjudicial remedy of Beneficiary.
(f) Beneficiarys Right to Appointment of Receiver. Beneficiary, as a matter of right and without regard to the sufficiency of the security for payment, performance and discharge of the Obligations, without notice to Grantor and without any showing of insolvency, fraud or mismanagement on the part of Grantor, and without the necessity of filing any judicial or other proceeding other than the proceeding for appointment of a receiver, shall be entitled to the appointment of a receiver or receivers of the Property and the Collateral or any part thereof, and of the Rents, and Grantor hereby irrevocably consents to the appointment of a receiver or receivers. Any receiver appointed pursuant to the provisions of this subsection shall have the usual powers and duties of receivers in such matters.
(g) Beneficiarys UCC Remedies. Beneficiary may exercise its rights of enforcement with respect to the Collateral under the UCC, and in conjunction with, in addition to or in substitution for the rights and remedies under the UCC Beneficiary may, and Grantor agrees, as follows: (i) without demand or notice to Grantor, enter upon the Property to take possession of, assemble, receive and collect the Collateral, or any part thereof, or to render it unusable; (ii) require Grantor to assemble the Collateral and make it available at a place Beneficiary designates which is mutually convenient to allow Beneficiary to take possession or dispose of the Collateral; (iii) written Notice mailed to Grantor as provided herein at least ten (10) days prior to the date of public sale of the Collateral or prior to the date after which private sale of the Collateral will be made shall constitute reasonable notice; (iv) any sale made pursuant to the provisions of this subsection shall be deemed to have been a public sale conducted in a commercially reasonable manner if held contemporaneously with the sale of the Property under power of sale as provided herein upon giving the same notice with respect to the sale of the Collateral hereunder as is required for such sale of the Property under power of sale, and such sale shall be deemed to be pursuant to a security agreement covering both real and personal property under Section 9.604 of the UCC; (v) in the event of a foreclosure sale, whether made by Trustee under the terms hereof, or under judgment of a court, the Collateral and the Property may, at the option of Beneficiary, be sold as a whole; (vi) it shall not be necessary that Beneficiary take possession of the Collateral, or any part thereof, prior to the time that any sale pursuant to the provisions of this subsection is conducted, and it shall not be necessary that the Collateral or any part thereof be present at the location of such sale; (vii) prior to application of proceeds of disposition of the Collateral to the Obligations, such proceeds shall be applied to the reasonable expenses of retaking, holding, preparing for sale or lease, selling, leasing and the like, and the reasonable attorneys fees and legal expenses incurred by Beneficiary; (viii) after notification, if any, hereafter provided in this subsection, Beneficiary may sell, lease or otherwise dispose of the Collateral, or any part thereof, in one or more parcels at public or private sale or sales, at Beneficiarys offices or elsewhere, for cash, on credit or for future delivery. Upon the request of Beneficiary, Grantor shall assemble the Collateral and make it available to Beneficiary at any place designated by Beneficiary that is reasonably convenient to Grantor and Beneficiary. Grantor agrees that Beneficiary shall not be obligated to give more than ten (10) days written notice of the time and place of any public sale or of the time after which any private sale may take place and that such notice shall constitute reasonable notice of such matters. Grantor shall be liable for all reasonable expenses of retaking, holding, preparing for sale or the like, and all reasonable attorneys fees, legal expenses and all other costs and expenses incurred by Beneficiary in connection with the collection of the Obligations and the enforcement of the rights of Beneficiary and Lenders under the Loan Documents. Beneficiary shall apply the proceeds of the sale of the Collateral against the Obligations in accordance with the requirements of this Deed of Trust. Grantor shall remain liable for any deficiency if the proceeds of any sale or disposition of the Collateral are insufficient to pay, perform and discharge the Obligations in full. Grantor waives all rights of marshalling in respect of the Personalty; (ix) any and all statements of fact or other recitals made in any bill of sale or assignment or other instrument evidencing any foreclosure sale hereunder, the nonpayment of the Obligations, the occurrence of any Event of Default, Beneficiary having declared all or a portion of such Obligations to be due and payable, the notice of time, place, and terms of sale and of the properties to be sold having been duly given, or any other act or thing having been duly done by Beneficiary, shall be taken as prima facie evidence of the truth of the facts so stated and recited; and (x) Beneficiary may appoint or delegate any one or more persons as agent to perform any act or acts necessary or incident to any sale held by Beneficiary, including the sending of notices and the conduct of the sale, but in the name and on behalf of Beneficiary.
(h) Rights Relating to Leases and Rents. Grantor has, pursuant to Section 2.2 of this Deed of Trust, assigned to Beneficiary, on behalf of Lenders, all Rents under each of the Leases covering all or any portion of the Property. Beneficiary, or Trustee on Beneficiarys behalf, may at any time, and without notice, either in person, by agent, or by receiver to be appointed by a court, enter and take possession of the Property or any part thereof, and in its own name, sue for or otherwise collect the Rents. All Rents collected by Beneficiary, or Trustee acting on Beneficiarys behalf, shall be applied as provided for in this Deed of Trust; provided, however, that if the costs, expenses and attorneys fees shall exceed the amount of Rents collected, the excess shall be added to the Obligations, shall bear interest at the rate of interest then applicable on the outstanding principal balance of the Note, and shall be immediately due and payable. The entering upon and taking possession of the Property, the collection of Rents, and the application thereof as aforesaid shall not cure or waive any Event of Default or notice of default, if any, hereunder nor invalidate any act done pursuant to such notice, except to the extent any such Event of Default is fully cured. Failure or discontinuance by Beneficiary, or Trustee on Beneficiarys behalf, at any time or from time to time, to collect said Rents shall not in any manner impair the subsequent enforcement by Beneficiary, or Trustee on Beneficiarys behalf, of the right, power and authority herein conferred upon it. Nothing contained herein, nor the exercise of any right, power or authority herein granted to Beneficiary, or Trustee on Beneficiarys behalf, shall be, or shall be construed to be, an affirmation by it of any tenancy, lease or option, nor an assumption of liability under, nor the subordination of, the lien of this Deed of Trust, to any such tenancy, lease or option, nor an election of judicial relief, if any such relief is requested or obtained as to Leases or Rents, with respect to the Property or any other collateral given by Grantor to Beneficiary for the benefit of Lenders. In addition, from time to time Beneficiary may elect, and notice hereby is given to each lessee under any Lease, to subordinate the lien of this Deed of Trust to any Lease by unilaterally executing and recording an instrument of subordination, and upon such election the lien of this Deed of Trust shall be subordinate to the Lease identified in such instrument of subordination; provided, however, in each instance such subordination will not affect or be applicable to, and expressly excludes any lien, charge, encumbrance, security interest, claim, easement, restriction, option, covenant and other rights, titles, interests or estates of any nature whatsoever with respect to all or any portion of the Property and the Collateral to the extent that the same may have arisen or intervened during the period between the recordation of this Deed of Trust and the execution of the Lease identified in such instrument of subordination.
(i) Other Rights. Beneficiary (i) may surrender the insurance policies maintained pursuant hereto or the other Loan Documents or any part thereof, and upon receipt shall apply the unearned premiums as a credit on the Obligations, in accordance herewith, and, in connection therewith, Grantor hereby appoints Beneficiary as agent and attorney-in-fact (which is coupled with an interest and is therefore irrevocable) for Grantor, during the existence of an Event of Default, to collect such premiums; and (ii) apply the reserve for impositions, if any, required by the provisions of this Deed of Trust, toward payment of the Obligations; and (iii) shall have and may exercise any and all other rights and remedies which Beneficiary may have at law or in equity, or by virtue of any Loan Document or under the UCC, or otherwise.
(j) Beneficiary as Purchaser. Beneficiary may be the purchaser of the Property and the Collateral or any part thereof, at any sale thereof, whether such sale be under the power of sale herein vested in Trustee or upon any other foreclosure of the liens and security interests hereof, or otherwise, and Beneficiary shall, upon any such purchase, acquire good title to the Property and the Collateral so purchased, free of the liens and security interests hereof, unless the sale was made subject to an unmatured portion of the Obligations. Beneficiary, as purchaser, shall be treated in the same manner as any third party purchaser and the proceeds of Beneficiarys purchase shall be applied in accordance with the requirements of this Deed of Trust.
(k) Possession After Foreclosure. If the liens or security interests hereof shall be foreclosed by power of sale granted herein, by judicial action or otherwise, the purchaser at any such sale shall receive, as an incident to purchasers ownership, immediate possession of the property purchased, and if Grantor or Grantors successors shall hold possession of said property or any part thereof subsequent to foreclosure, Grantor and Grantors successors shall be considered as tenants at sufferance of the purchaser at foreclosure sale (without limitation of other rights or remedies, at a reasonable rental per day, due and payable daily, based upon the value of the portion of the Property and the Collateral so occupied or possessed and sold to such purchaser), and anyone occupying or possessing such portion of the Property and the Collateral, after demand is made for possession thereof, shall be guilty of forcible detainer and shall be subject to eviction and removal, forcible or otherwise, with or without process of law, and all damages by reason thereof are hereby expressly waived.
(l) Abandonment of Sale. In the event a foreclosure hereunder is commenced by Trustee in accordance with subsection (d) hereof, at any time before the sale, Trustee may abandon the sale, and Beneficiary may then institute suit for the collection of the Obligations and for the foreclosure of the liens and security interests hereof and of the Loan Documents. If Beneficiary should institute a suit for the collection of the Obligations and for a foreclosure of the liens and security interests hereof, Beneficiary may, at any time before the entry of a final judgment in said suit, dismiss the same and require Trustee to sell the Property and Collateral or any part thereof in accordance with the provisions of this Deed of Trust.
Section 9.22 Application of Foreclosure Sale Proceeds.
Except as may be otherwise required by applicable law, after deducting all reasonable costs, fees and expenses of Trustee, and of this trust, including, without limitation, cost of evidence of title and attorneys fees in connection with sale and costs and expenses of sale and of any judicial proceeding wherein such sale may be made, Trustee shall apply all proceeds of any foreclosure sale: (a) to payment of all sums expended by Beneficiary under the terms hereof and not then repaid, with accrued interest at the rate of interest specified in the Note to be applicable on or after maturity or acceleration of the Note; (b) to payment of all other Obligations, and (c) the remainder, if any, to the person or persons legally entitled thereto.
Section 9.23 Application of Other Sums.
All sums received by Beneficiary under Section 9.21 or Section 2.2, less all reasonable costs and expenses incurred by Beneficiary or any receiver under Section 9.21 or Section 2.2, including, without limitation, attorneys fees, shall be applied in payment of the Obligations in such order as Beneficiary shall determine in its sole discretion; provided, however, Beneficiary shall have no liability for funds not actually received by Beneficiary.
Section 9.24 No Cure or Waiver.
Neither Beneficiarys nor Trustees nor any receivers entry upon and taking possession of all or any part of the Property and the Collateral, nor any collection of rents, issues, profits, insurance proceeds, condemnation proceeds or damages, other security or proceeds of other security, or other sums, nor the application of any collected sum to any Obligation, nor the exercise of or failure to exercise any other right or remedy by Beneficiary or Trustee or any receiver shall cure or waive any breach, Default, Event of Default or notice of default under this Deed of Trust, or nullify the effect of any notice of default or sale (unless all Obligations then due have been paid and performed and Grantor has cured all other defaults), or impair the status of the security, or prejudice Beneficiary or Trustee in the exercise of any right or remedy, or be construed as an affirmation by Beneficiary of any tenancy, lease or option or a subordination of the lien of or security interest created by this Deed of Trust.
Section 9.25 Payment of Costs, Expenses and Attorneys Fees.
Grantor agrees to pay to Beneficiary immediately and without demand all reasonable costs and expenses incurred by Trustee and Beneficiary pursuant to Section 9.22 (including, without limitation, court costs and attorneys fees, whether incurred in litigation or not) with interest from the date of expenditure until said sums have been paid at the rate of interest then applicable to the principal balance of the Note as specified therein. In addition, Grantor shall pay to Trustee all reasonable Trustees fees hereunder and shall reimburse Trustee for all reasonable expenses incurred in the administration of this trust, including, without limitation, any attorneys fees.
Section 9.26 Inapplicability of Finance Code.
In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts and revolving triparty accounts) apply to the loan evidenced by the Loan Documents and/or secured hereby.
Section 9.27 Collateral Protection Insurance.
TEXAS FINANCE CODE SECTION 307.052 COLLATERAL PROTECTION INSURANCE NOTICE: (A) GRANTOR IS REQUIRED TO: (i) KEEP THE PROPERTY INSURED AGAINST DAMAGE IN THE AMOUNT BENEFICIARY SPECIFIES; (ii) PURCHASE THE INSURANCE FROM AN INSURER THAT IS AUTHORIZED TO DO BUSINESS IN THE STATE OF TEXAS OR AN ELIGIBLE SURPLUS LINES INSURER; AND (III) NAME BENEFICIARY AS THE PERSON TO BE PAID UNDER THE POLICY IN THE EVENT OF A LOSS; (B) GRANTOR MUST, IF REQUIRED BY BENEFICIARY, DELIVER TO BENEFICIARY A COPY OF THE POLICY AND PROOF OF THE PAYMENT OF PREMIUMS; AND (C) IF GRANTOR FAILS TO MEET ANY REQUIREMENT LISTED IN SUBSECTION (A) OR (B), BENEFICIARY MAY OBTAIN COLLATERAL PROTECTION INSURANCE ON BEHALF OF TRUSTOR AT TRUSTORS EXPENSE.
Section 9.28 Rights and Remedies of Sureties.
Grantor waives any right or remedy which Grantor may have or be able to assert pursuant to Chapter 34 of the Business and Commerce Code of the State of Texas pertaining to the rights and remedies of sureties.
Section 9.29 Deficiency.
(a) In the event that the fee, a leasehold estate or any other interest in all or any portion of the Property and the Collateral is foreclosed upon pursuant to a judicial or nonjudicial foreclosure sale (the Foreclosed Property), Grantor agrees as follows: Notwithstanding the provisions of Sections 51.003, 51.004, and 51.005 of the Texas Property Code (as the same may be amended from time to time), and to the extent permitted by law, Grantor agrees that Trustee, on behalf of Lenders, shall be entitled to seek a deficiency judgment from Grantor and any other party obligated for the Obligations or any portion thereof equal to the difference between the amount owing of the Obligations and the amount for which the Foreclosed Property was sold pursuant to judicial or nonjudicial foreclosure sale. Grantor expressly recognizes that this section constitutes a waiver of the above-cited provisions of the Texas Property Code which would otherwise permit Grantor and other persons against whom recovery of deficiencies is sought or any guarantor independently (even absent the initiation of deficiency proceedings against them) to present competent evidence of the fair market value of the Foreclosed Property as of the date of the foreclosure sale and offset against any deficiency the amount by which the foreclosure sale price is determined to be less than such fair market value. Grantor further recognizes and agrees that this waiver creates an irrebuttable presumption that the foreclosure sale price is equal to the fair market value of the Foreclosed Property for purposes of calculating deficiencies owed by Grantor, any guarantor, and others against whom recovery of a deficiency is sought.
(b) Alternatively, in the event the waiver provided for in subsection (a) above is determined by a court of competent jurisdiction to be unenforceable, the following shall be the basis for the finder of facts determination of the fair market value of the Foreclosed Property as of the date of the foreclosure sale in proceedings governed by Sections 51.003, 51.004 and 51.005 of the Texas Property Code (as amended from time to time): (i) the Foreclosed Property shall be valued in an as is condition as of the date of the foreclosure sale, without any assumption or expectation that the Foreclosed Property will be repaired or improved in any manner before a resale of the Foreclosed Property after foreclosure; (ii) the valuation shall be based upon an assumption that the foreclosure purchaser desires a resale of the Foreclosed Property for cash promptly (but no later than twelve (12) months) following the foreclosure sale; (iii) all reasonable closing costs customarily borne by the seller in commercial real estate transactions should be deducted from the gross fair market value of the Foreclosed Property, including, without limitation, brokerage commissions, title insurance, a survey of the Property, tax prorations, attorneys fees, and marketing costs; (iv) the gross fair market value of the Foreclosed Property shall be further discounted to account for any estimated holding costs associated with maintaining the it pending sale, including, without limitation, utilities expenses, property management fees, taxes and assessments (to the extent not accounted for in subsection (iii) above), and other maintenance, operational and ownership expenses; and (v) any expert opinion testimony given or considered in connection with a determination of the fair market value of the Foreclosed Property must be given by persons having at least five (5) years experience in appraising property similar to the Foreclosed Property and who have conducted and prepared a complete written appraisal of the Property and the Foreclosed Property taking into consideration the factors set forth above.
Section 9.30 Subrogation to Existing Liens; Vendors/Purchase Money Lien.
To the extent that proceeds of the Note are used to pay indebtedness secured by any outstanding lien, security interest, charge or prior encumbrance against the Property, such proceeds have been advanced by Beneficiary at Grantors request, and Beneficiary shall be subrogated to any and all rights, security interests and liens owned by any owner or holder of such outstanding liens, security interests, charges or encumbrances, however remote, irrespective of whether said liens, security interests, charges or encumbrances are released, and all of the same are recognized as valid and subsisting and are renewed and continued and merged herein to secure the Obligations, but the terms and provisions of this Deed of Trust shall govern and control the manner and terms of enforcement of the liens, security interests, charges and encumbrances to which Beneficiary is subrogated hereunder. It is expressly understood that, in consideration of the payment of such indebtedness by Beneficiary, Grantor hereby waives and releases all demands and causes of action for offsets and payments in connection with the said indebtedness. If all or any portion of the proceeds of the loan evidenced by the Note or of any other secured indebtedness has been advanced for the purpose of paying the purchase price for all or a part of the Property, no vendors or purchase money lien is waived; and Beneficiary shall have, and is hereby granted, a vendors or purchase money lien on the Property as cumulative additional security for the secured indebtedness. Beneficiary may foreclose under this Deed of Trust or under the vendors or purchase money lien without waiving the other or may foreclose under both.
Section 9.31 WAIVER OF JURY TRIAL.
EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS DEED OF TRUST OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS DEED OF TRUST AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 9.32 Rights of Tenants.
Beneficiary shall have the right and option to commence a civil action to foreclose this Deed of Trust and to obtain a decree of foreclosure and sale subject to the rights of any tenant or tenants of the Property having an interest in the Property prior to that of Beneficiary. The failure to join any such tenant or tenants of the Property as party defendant or defendants in any such civil action or the failure of any decree of foreclosure and sale to foreclose their rights shall not be asserted by Grantor as a defense in any civil action instituted to collect the Obligations, or any part thereof or any deficiency remaining unpaid after foreclosure and sale of the Property, any statue or rule of law at any time existing to the contrary notwithstanding.
Section 9.33 Substitute Trustee.
Trustee may resign by an instrument in writing addressed to Beneficiary, or Trustee may be removed at any time with or without cause by an instrument in writing executed by Beneficiary. In case of the death, resignation, removal, or disqualification of Trustee, or if for any reason Beneficiary shall deem it desirable to appoint a substitute or successor trustee to act instead of the herein named trustee or any substitute or successor trustee, then Beneficiary shall have the right and is hereby authorized and empowered to appoint a successor trustee(s), or a substitute trustee(s), without other formality than appointment and designation in writing executed by Beneficiary and the authority hereby conferred shall extend to the appointment of other successor and substitute trustees successively until the Obligations has been paid in full, or until the Property is fully and finally sold hereunder. If Beneficiary is a corporation or association and such appointment is executed on its behalf by an officer of such corporation or association, such appointment shall be conclusively presumed to be executed with authority and shall be valid and sufficient without proof of any action by the board of directors or any superior officer of the corporation or association. Upon the making of any such appointment and designation, all of the estate and title of Trustee in the Property shall vest in the named successor or substitute Trustee(s) and he shall thereupon succeed to, and shall hold, possess and execute, all the rights, powers, privileges, immunities and duties herein conferred upon Trustee. All references herein to Trustee shall be deemed to refer to Trustee (including any successor(s) or substitute(s) appointed and designated as herein provided) from time to time acting hereunder.
Section 9.34 No Liability of Trustee.
Trustee shall not be liable for any error of judgment or act done by Trustee in good faith, or be otherwise responsible or accountable under any circumstances whatsoever (including Trustees negligence), except for Trustees gross negligence or willful misconduct. Trustee shall have the right to rely on any instrument, document or signature authorizing or supporting any action taken or proposed to be taken by him hereunder, believed by him in good faith to be genuine. All moneys received by Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated in any manner from any other moneys (except to the extent required by law), and Trustee shall be under no liability for interest on any moneys received by him hereunder. Grantor hereby ratifies and confirms any and all acts which the herein named Trustee or its successor or successors, substitute or substitutes, in this trust, shall do lawfully by virtue hereof. Grantor will reimburse Trustee for, and save it harmless against, any and all liability and expenses which may be incurred by it in the performance of its duties. The foregoing indemnity shall not terminate upon discharge of the Obligations or foreclosure, or release or other termination, of this Deed of Trust.
Section 9.35 Entire Agreement.
The Loan Documents constitute the entire understanding and agreement among Grantor, Beneficiary and Lenders with respect to the transactions arising in connection with the Loan, and supersede all prior written or oral understandings and agreements between Grantor, Beneficiary and Lenders with respect to the matters addressed in the Loan Documents. In particular, and without limitation, the terms of any commitment by Beneficiary and Lenders to make the Loan are merged into the Loan Documents. Except as incorporated in writing into the Loan Documents, there are no representations, understandings, stipulations, agreements or promises, oral or written, with respect to the matters addressed in the Loan Documents.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, Grantor has caused this Deed of Trust to be executed under seal as of the day and year first written above.
GRANTOR:
G&E HC REIT II ENNIS MOB, LLC,
a Delaware limited liability company
By: GRUBB & ELLIS HEALTHCARE REIT II HOLDINGS, LP,
a Delaware limited partnership, its sole Member
By: GRUBB & ELLIS HEALTHCARE REIT II, INC.,
a Maryland corporation, its general partner
By: /s/ Shannon K S Johnson
Name: Shannon K S Johnson
Title: Chief Financial Officer
STATE OF CALIFORNIA COUNTY OF ORANGE | ) ) ) | SS. |
On January 25, 2011, before me, P.C. Han, Notary Public, personally appeared Shannon K S Johnson, who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that she executed the same in her authorized capacity, and that by her signature on the instrument the person, or the entity upon which the person acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: /s/ P.C. Han (Seal)
Notary Public
Name: P.C. Han
My commission Expires: June 25, 2011